In the old days buy-here pay-here dealerships used to be called tote the notes. In other words, the dealership carries the note. Instead of customers sending their payments to the bank that financed the vehicle through the dealership, the buy-here pay-here dealer is the bank and the place to make payments. All in one place.
In-house financing is what it's all about. People buy their car here and pay for the car here. They are not dealing with a bank; they’re coming to us.
What’s nice about that, especially with Russell Smith Auto, is that it gives us a chance to know our customers and they get to know us. If they come in to make their payment, they’ll see the salesman who sold them the car, and the manager who helped with the financing. So our customers are just coming in and seeing the people that they know, that they dealt with originally.
How are we able to do in-house financing? Well, we’re basically just holding the notes, we don’t sell them. We try to grow our note base. That's our model, and it’s the buy-here pay-here business. We’re the bank, basically. We say “yes” or “no.” Approvals are all run through us.
There’s also a myth about buy-here pay-here dealers being in the repo business. That they sell cars in order to repossesses them and then re-sell to make more money. Well, that's not what we do. I mean, we're in the selling of used cars business. For one thing, we sink a lot of money into vehicles before we put them into our inventory and sell them so make sure they are safe and reliable. It doesn’t make sense to do that, lose money on payments from the customer and try to go through all that again. If someone gets behind on their payments, we try to work with them and help them figure out what's going on and how to avoid repossession. We're not in the repo business.