Sparta expects the new offering to spread first through dealers who own both powersports and auto dealerships.
Through a purchase and sale agreement with a subsidiary of “one of the country's largest independent regional banks,” Sparta will offer a non-prime consumer indirect automobile financing program through new and pre-owned car dealers.
Under the terms of the agreement, Sparta will generate revenue from the origination and sale of the loans, and will only be responsible for losses due to a customer's first payment default or non-delivery of title, both of which are the responsibility of the selling dealer pursuant to the terms of Sparta's dealer agreements.
The new Sparta non-prime retail installment sales contract program is specifically designed for consumers whose credit and related criteria may not be sufficient to meet the more stringent requirements of many lenders.
"We never realized that our reputation for prudent credit risk evaluation and loan servicing abilities had spread beyond the powersports industry, but we were obviously pleased when approached and presented with this opportunity,” CEO Anthony Havens said in a press release. “With the addition of a new, non-prime automobile financing program, we've significantly expanded our addressable market. Even though we continue to grow and service the powersports industry, the automobile financing sector is substantially larger, and we fully expect that our presence in this new marketplace will produce positive results for Sparta and our shareholders."
Posted by Holly Wagner