|
| |
AFP – Alternate Finance Program
The Alternate Finance Program (AFP) was launched circa 1992
to target a segment of our market that had previously not been possible to
finance. The 1st Term E-2 through E-4; and prospects that have light
and or somewhat poor credit history. The success of the OMSC AFP program over
the last decade has resulted in 10% incremental business. Managed properly,
AFP business will help you earn thousands of dollars more annually.
The current AFP program is broken down into 3 programs with
different requirements. The codes for the programs are located in the upper
right hand corner of the AFP LOI which you will receive from FSG.
- AFP Code 141- The AFP 141 program is full
recourse. Full recourse means that in the event of default, the liability for
paying off the balance of the loan resides with OMSC. There is no liability
for the agent after the delivery. The cash down payment requirement is 5%.
This amount is based the Total Selling Price (TSP) and must be cash. A Rebate
is not part of the Cash calculation. APR is 16.99%.
- AFP-Code 141 “R” Tier- The AFP “R” Program
is also full recourse. “R” Tier will be designated at the bottom of the LOI
and will indicate that the APR is 18.99% with a cash requirement of 5%.
- AFP-S Code 148- The AFP S program is
designed for a slightly higher credit risk customer. The AFP S program is
sponsored by Ford Motor Credit (FMCC), which assumes liability in the event of
customer default. APR is 16.99%. Since Ford carries the full risk, they have
the option of requiring larger cash down-payments where they think them
warranted.
-
Click here for Harley Davidson AFP
It’s Critical to Know:
- All
AFP programs require that the prospect have a minimum of 1 year remaining in
service from the delivery date. ETS must be at least one year after
the delivery date.
- You
will note that when you receive a LOI from FSG that the stipulation reads
“AFP Approved Pending CO Check”.
This means that although the
finance application is approved, a finance contract will not be issued until
the CO Check is completed. Other LOI’s, which contain additional
stipulations, other than the requirements to provide complete personal
references and a CO Check, will be called back as
“AFP Eligible
Pending CO Check”. These applications
will not receive final approval, nor will contracts be issued, until all of
the stipulations have been satisfied. Remember to get any AFP
Eligible Pending CO Check LOI upgraded to Approved Status before the minimum
lead time required for the delivery date. The sooner after the order, the
better.
- CO means Commanding Officer. The form is a formal a
request for personal information through the command. The form must be given
to the customer with strict instructions given to have the form filled out by
their 1st Sergeant or Commanding Officer. If they are not
available, then an E-6 or above will suffice. Click here to see and print. Please see example The CO Form is to be submitted to your
Management. Management will verify that the information is correct by calling
the person that signed the form. Management will submit the CO form on your
behalf to FSG. Once FSG processes the form, a finance contract can be issue
if all other stipulations have been met.
- OPP is Highly Recommended on
AFP Finance Contracts. The reason that OPP is mandatory is highly
recommended is that it prevents a default arising from a major repair bill
during the course of the loan thereby protecting the customer’s credit rating.
Many of our AFP customers rely on tight budgets to keep their households
going and the need to be able to predict expenses is very important to them.
- Pay by Allotment is
Mandatory on AFP Finance Contracts. An allotment is a very
reliable way to pay bills without having to think about them. A mandatory
allotment reduces the risk of the loan to the issuer. Civilians, who are
unable to set up allotments, must repay through FMCC’s Preferred Payment Plan
option, which is an automatic deduction from their personal checking account.
- The AFP Program is unavailable for the Korea Local
Delivery Program.
|
