Boost Sales With Financing - PODCAST TRANSCRIPT

Editor's note: The following is the transcript of a live interview with Justus Knights & Chris Morris of Roofle. You can read the interview below, listen to the podcast or watch the recording.

Intro: Hello and welcome to RoofersCoffeeShop Lunch & Learn. We are here today with you hopefully sitting in your office watching this Lunch & Learn to learn all about financing. That is right, financing, so important. And so we have our experts from Roofle,  Justus [inaudible 00:00:32] here today to talk about that. Justus, welcome to the Lunch & Learn.

Justus: Thank you so much for having me, Heidi. I'm happy to be here.

Heidi: Ah, we're so happy to have you. Real quick, a couple of housekeeping. Be sure to download your discussion sheet and take notes because you can go on to RufusCoffeShop.com after you watch this and take the quiz. And you will get a certificate of completion and get entered into a contest to win a free lunch from Roofers Coffee Shop. So be sure to do that and have everything ready. I hope you're all enjoying your lunch as we present this Lunch & Learn. So first off, let's do some introductions. Justus, can you introduce yourself and talk a little bit about what you do with Roofle?

Justus: Yeah, absolutely. So I am from the customer success team here at Roofle.

Roofle is a technology service. We supply Contractor Loan PRO, what we're here to talk about today, a direct to consumer point of need financing solution. And we also provide Roof Quote PRO, an instant quote technology designed specifically for roofers. I take care of general customer success needs, making sure contractors know how to use our tools and get the most out of them. And more specifically, I take care of Contractor Loan PRO on a day-to-day basis. So I am a finance teacher, finance coach. I make sure that everybody's applications are coming through effectively and make sure that contractors are getting the finance and solutions that they need in a timely manner.

Heidi: That sounds great. Wow, this is going to be excellent. This is the type of information you really need to work with consumers, especially with the interest rates possibly going down. There's a lot of reason out there that financing makes a lot of sense. So in today's Lunch & Learn, we are going to be focusing on three learning objectives. And that is financing overview, Contractor Loan PRO and custom external financing. So three learning objectives. We'll get started with our very first one. Justus, let's start with financing overview and can you tell us a little bit about how homeowners are... I'm going to start that over again.

Heidi: Can you tell us what it traditionally looked like for homeowners to get financing working with a roofing contractor?

Justus: Yeah, absolutely. So financing has historically been a bit of a pain for homeowners and for contractors alike. The most traditional would be a homeowner speaking to a contractor, getting an estimate, probably speaking to a couple contractors, getting several estimates and then taking that information to their bank and taking out a personal loan from their bank to get this work done. Whether that's a home equity line of credit, like a HELOC loan or whether that's just a personal loan based on their own personal credit.

Justus: In any case, it takes a visit to the bank or a call to the bank and paperwork to do in that way. So the traditional route is typically time-consuming and labor inducive and carries a lot of uncertainty with it. Because you have to go to a personal bank that does not necessarily specialize in the type of financing that you are needing in that moment. Whereas if you think about contractor's needs and homeowner's needs as they pertain to home improvement, you can think of it similar to a car dealership. If you go to a car dealership, you can typically get your vehicle financed there because they partner with specialized financing institutions that are providing financing for vehicles. So contractors should have their own partners that specialize in that type of financing to streamline that process for their customers.

Heidi: That makes so much sense and it is, we are changing from really a traditional old way of doing it to this new one. So why is integrating a financing such a great option for contractors?

Justus: Yeah. So the biggest thing that it does is it will hopefully satisfy the needs of your customers. First and foremost, we want to make sure that we're taking care of our customers. So if the customer needs to finance a project, we want to make sure that we have that support available for them in any format whatsoever. Any way to help your customer cross that bridge of needing the financing and getting the financing. The secondary side of it is taking control of that process for your customer and making it available to them at a point of need. Then making sure that they don't have to take additional steps, get you closer to a signed contract.

Justus: So the less time that you have to put and less responsibility you have to put on your customer to solve their own issue of financing, the more likely you are to close that deal. So we want to take that, the uncertainty of I need a project done and here's how I'm going to pay for the project. We want to shrink that down as much as we can so that it becomes a no-brainer of I need my project funded and I want this project done as quickly as possible. There should be no space in there. We want to treat it just like cash if we can.

Heidi: Yeah, that's great. I mean, and that makes it so much easier. Talk to me about the benefits, I mean from a sales and marketing standpoint, but also just those benefits for the customers when contractors can integrate and offer that kind of financing.

Justus: Yeah. So there are ways that we can integrate financing from the first interaction that a customer has with a contractor. So ideally advertising, financing on your website so that the second somebody finds you... Or in your advertising efforts. So if you're going to say, advertise your services online or on a billboard, putting that you offer financing there right off the bat so that if a customer is looking to make a luxury decision as in this is not a necessity for their home, but they've wanted a new kitchen, they've wanted to put a deck on their house, they want a tin roof because they like the sound of it, for instance.

Justus: You offer financing right out the gate. They know that doesn't have to be an out of pocket expense for them. And then as a point of need for a customer to show up to your website, I need somebody to come fix my roof because it's leaking. The first thing that they see on your website is that you offer financing. They know great, I don't have to completely tank my savings to get the drip to stop in my dining room. So we want to make sure that that's available to them from the very beginning. We want it in the conversation as early as possible so they don't come asking us for it. It should be there and available as a payment option.

Heidi: Financing today can be kind of scary because of our credit scores and because of how you do it. So you can really... When contractors are looking at this bigger picture, not having to take a credit hit, being able to have multiple options, that just seems like really important too.

Justus: Correct. And so specifically with Contractor Loan PRO, what we have done is tried to make this as straightforward for our contractors as possible so they don't have to become finance professionals because that's what I'm here for. And also as risk-free and transparent for the consumer. So we want to let that consumer know from the jump that they're not going to affect their credit to get approved. So we have pre-approval processes built into our system that are 100% accurate. So it's very important to tell a customer, A, your application is risk-free.

Justus: Nothing is going to happen to your credit if you do not proceed to take out a loan. And B, it is 100% accurate. So you're not going to get your hopes up with a pre-approval only to say, okay, cool, I'll go ahead and take the hit on my credit to get approved for this only to find that your APR has changed or your maximum approved limit has changed. So we want to confirm with that customer, we want to build that confidence immediately that you're taking no risk and you are actually getting an accurate guarantee of what you will be approved for.

Heidi: That's excellent. That's excellent. Well, let's move on to our second learning objective, which is really learning about Contractor Loan PRO. So Justus, why don't we start out with what it is and maybe a demo.

Justus: Absolutely. So what it is to answer that question before we just look straight at the demo, we are a point of need lending solution that is built directly into the sales process. So we offer a wide variety of loan products that the contractor can choose from. They can change those at any point. So you can run specials and have premium financing, you can have your basic financing that you use day in and day out. And then if you have a specific customer who really needs something special, you can go and find that within our catalog of products. Everything is instant, everything is digital. So you are only sending a link to your consumer. They are opening that link, filling out an application on their cell phone, on their computer, on their tablet. They will be instantly approved or declined. So they will immediately see in a soft credit pull what they've been approved for.

Justus: So you might select four loan options to send to your customer. They open that link and apply for those four loan products based on their credit. They might only see three of those products or might only see two of those products, but once they do, they will see a concise overview of the products they've been approved for. They will select the one they want and then proceed to a hard pull for that product alone with a guarantee that their pre-approval will be valid for their final approval. So that's the process in a nutshell. The application takes about two to five minutes for a homeowner. Very, very straightforward. We are only looking to know who you are, where you are, income and social security. That is all that we need to be able to approve a customer on a soft pull and take that right into a hard pull.

Justus: So what that looks like in real time, I'm going to share my screen and we can dig into this a little bit. So what we are seeing here is a finance dashboard. So we'll have some basic information. We'll have our recent loan application, so everyone who's submitted an application with us as well as their status, so whether they've been approved, what amount they got approved for, what product they have available to them. Below that, we will then have available transactions. So everyone who has money to spend with you, you'll have your recent transactions that have occurred. Outside of this, we have a list of all running transactions and we have a statements page that is published monthly and shows in great detail everything that's happened on your account. More importantly than that though, we have our rate sheet page. So this is where you select your products that you want to present to your customers.

Justus: So you have a standard base package, your default collection of loan products. You can also create offer codes so you can create maybe a premium financing offer code, maybe if you sell your home improvement products on a good, better, best platform. So a lot of roofers will sell a good, better, best roofing product. You could attach a good, better and best financing package to each of those so that if a customer is willing to buy your best roofing product, maybe you're willing to offer them a better financing solution. If they just want the bare bones, just get a roof replaced. Maybe you just offer them something that's going to help them out financially, maybe something that's got very low payments. Maybe if they're just looking for the simplest solution to get a roof on their house, maybe you want to give them the simplest, most straightforward financing option with the best chance of approval.

Justus: You have a lot of variety here in what you are allowed to do and what you're capable of. You also have a running list of every single product on our book that you can choose from at any point. So it's all very straightforward, click of a button, add this product to your base package. Now it's in your collection of loan products sent out to a customer. From here, it is a very straightforward process to get an application to your customer. You can simply hit this new loan application button. It will open a window, select a phone number for your customer or an email address, select what financing you're going to send to this customer. So we'll just send over this base package and you hit send. Your customer has now received an application for financing. So very straightforward, very simple and once they get that application for financing, it is even more straightforward. So I'm going to open this up into full screen and we are going to run through this briefly. So again, you have sent this over to your customer... And are you getting this?

Heidi: Yes.

Justus: Heidi.

Heidi: Mm-hmm.

Justus: Perfect. So you have sent this over to your customer. They have received a link to their cell phone. So we are just going to run through that consumer application. I'm going to step back to the beginning there real quick. So they get that link sent to their cell phone, they open it up and we're going to immediately let them know. We're just going to ask for their name, address, date of birth. We're going to ask for their social security number. We're letting them know that they are going to be able to see their financing options without impacting their credit. And then we will only do a hard credit inquiry once they accept an offer and submit it for review. So we're trying to be transparent again with that customer from the jump. They will approve the privacy notice, they will tell us how much they want to borrow.

Justus: We're going to confirm their identity by sending a six digit code back to their cell phone or their email address to make sure that we're dealing with the same person. Once they're done with that, we are going to ask them who they are, we're going to ask them where they are, we're going to confirm that address with them. And then we're going to ask them their annual household gross income, social security number and date of birth. So very straightforward, again. Just any income associated with that household, social and date of birth for the applicant. We're going to ask them for a four digit PIN code in case they want to come back to this application. We're just going to verify all that information. We're going to give them one last chance to look it over, make sure that everything is correct. And then they'll proceed and as fast as their internet can refresh, they have been approved or declined.

Heidi: Wow.

Justus: So in this case, they get approved and they will see the finance options you've made available. So maybe you have some same as cash and fixed rate and fixed payments on your list. So they'll see them in an easily navigated format so that they can run through and say, maybe I want to same as cash. They can see what those options look like. They can see what that payment would look like during the promotional period, and then after the promotional period they'll see their APR. And likewise for all of the other products they're going to see for every product, a breakdown of what their payments would look like, what their promotion looks like, what their APR is and the loan term.

Justus: Additionally, they can see the fine print, if they hit these three dots here. They can then see the fine print on everything associated with this financing product. From here, they would simply choose the one that they like. They select that. They hit proceed. We confirm with them that they are comfortable taking a hard pull to their credit. So we do make one final confirmation before we proceed. And again, as fast as their internet can refresh, they are brought through to finalize that application. All they're doing is finalizing that they are accepting the loan. This basically acts as an e-signature for them. They sign that document digitally and here they are. Congratulations, your loan has been approved.

Heidi: That's awesome.

Justus: So all of that is practically real time. Obviously it's a video, so the data goes in instantly, but as quickly as they can type in their name, address, income and social, they can get through a financing application with us. So all extremely straightforward. One of the most exciting features to this is actually the transactions for the contractor. So this is the part that I'm probably most proud of. Typically, financing or insurance work, anything besides cash takes a while to get paid. So what we're most proud of here is the fact that we can just click on this customer.

Justus: We can transact immediately. As soon as that customer has been approved for financing, I can come in... This consumer has $5,000 left to spend because we've already spent 18,000. We can come in here, I'll put in a request for $5,000. Let's say this is the final charge. I'm going to send that request to my consumer. All they're going to do is get a text message asking them to approve the transaction. All they have to do is approve that transaction on their cell phone through a text message, and that transaction is complete on a same day, next day ACH transfer.

Heidi: That is phenomenal. It's phenomenal. Makes it so easy and... I mean, it makes the customer experience so positive.

Justus: Exactly. That's the aim. It's just try to make it as simple and straightforward for everyone involved to take the hassle out of it, so your customer's not sitting there hemming and hawing over whether this is the right or not. You've made it the right decision by making it so convenient.

Heidi: When we talk about it being integrated onto the website, can consumers go in there and see this ahead of time or is this something that's happening during the sales process or both?

Justus: Either one is perfectly fine. You can attach this to your website. We have a lot of materials that you can also use to educate your customer in advance. So a lot of contractors will have a website with a services page and with a finance page. You can lead your customer to that finance page. We have a lot of materials that you can use to show your customer how this would work, make sure that it's transparent, they know what they're walking into. So they could schedule an appointment with your team and go to your finance page, go ahead and get themselves one of these applications and get pre-approved. When your sales rep shows up, they already know what their budget is for this project because they've been pre-approved for it.

Heidi: That's excellent. How about customization of the loans? Can contractors... You showed us there, we're picking these three to send out. How does that all work?

Justus: Yeah, so the contractors will have a selection of 40 different loan products running from a 2.99% APR up to a 13.99% APR on fixed rate products. So just in the fixed rate category, and those are running from three years up to 12 years. We also have deferred interest loans. So true, no payment, no interest for periods of six months up to 24 months. And then we also have guaranteed payment loans. So these loans are really interesting in that your sales rep, if they know the cost of the project, they can accurately tell the customer what their monthly cost would be instantly. As long as they know the numbers that they are based on, and we've made those numbers very round and straightforward. So you can tell a customer you're paying 2% of your project every single month. So if that's a $10,000 project, 200 bucks a month. If your customer can afford that $10,000 is a great price for them. So we've made it very, very straightforward. We also have second look products, which will help out any credit challenged customers and we also have zero dealer fee products and zero interest products.

Heidi: Wow. Okay. Well, okay. You're saying you have your finance page, you have your information, it's integrated on there. Let's talk a little bit about how does it work. How does that work on to have it branded? The contractor branding, onboarding, what does it take to make that all happen?

Justus: Yeah, absolutely. So the way that we make this happen is you can come to us either with a Roof Quote PRO subscription. So any of our roofers who are currently established on our platform already have complete access to this tool. They would simply go to their finance page and hit the application button and they will start an application to get access to financing. Anyone else who's maybe not a roofer or maybe not a ruble customer who is still interested in this instant financing can also get a Contractor Loan PRO subscription by itself for 9,99 a month. What that does is you will come to us, get an account, jump in and do that financing application. Once you are company has been approved for financing, you will come to me and my team, we will train you on how the financing works. We will go over the compliance information associated with the financing, and then we will assist in guiding you to set up your financing packages.

Justus: So we'll look over the products, we'll look over your current sales strategy, we'll see what dealer fees you're comfortable working in. What your typical customers are like, maybe what your target customer is looking like and make sure we're selecting financing packages with you that meet your market's needs. So we don't want go offer a ton of really high APR, but low monthly payment loans to a very affluent area that's going to be looking for low APR loans. So we'll go in, we'll ask about your customers, we'll ask about your clientele and your market and then we'll start picking loan products and packages that would make sense for you guys. You run with that for a few months and we are constantly available to analyze that, make sure that things are going in the right direction, make sure that your customers are getting approved and make any adjustments down the line that might be needed.

Heidi: That is excellent. And it really differentiates that business for that contractor or for anyone who's using this, like you said. What are some of the things you're hearing from contractors and also from homeowners on how this has really changed their closing rates and being able to get in front of those homeowners?

Justus: Oh, absolutely. So one of the biggest things that I hear most often is simplicity. So contractors who are used to using financing are used to a degree of complexity that makes it a little bit of a pain to teach a sales team how to use it or to get a customer to feel comfortable to move forward with it. So the biggest thing that I hear back is on the simplicity of the platform. We've worked extremely hard to make this a simple process. The next thing would be the speed of getting funding, making it so that the homeowner knows immediately if they've been approved and the contractor knows immediately that they can get paid for their project and go ahead and get started. So there's no lag in waiting for funding to come through or waiting for a transaction to get approved. And then besides that, financing across the board, whether you're using ours or using anything else, financing increases the average ticket size by a pretty significant margin.

Justus: As soon as a customer knows they don't have to come out of pocket for something or they could come partially out of pocket and pay cash and then finance the rest of it, they know that they can expand that project. So what it's doing for homeowners is letting them know you had an idea in your mind and you had a vision for your new kitchen or your new bathroom or your new roof, and you might be limited by your own savings account or your own allotment for this project, but once you can finance it, a lot of that goes away. So you know what, stretch a little bit or work it out into a monthly payment rather than an upfront chunk of cash and go ahead and get the roof you really want. Go ahead and get the kitchen or bath that you really are dying for. Maybe it's your forever home. It's worth the investment.

Heidi: It really is. And this makes it possible.

Justus: Exactly.

Heidi: Well, let's go on to our third learning objective, which is custom external financing. So how does this work? I mean, from a technology standpoint, talk to us a little bit about that.

Justus: Yeah. So from a technology standpoint, it is extremely complex and it is extremely protected by a lot of copyright most of the time. But from what it matters to us is a couple of important factors, is that A, we have created a platform that makes it a straightforward process from the contractor to the consumer. So there is a lot of technicality that's happening in between there, but the functionality that people experience is the click of a few buttons. So what we are doing is we are connecting a base of financial partners, so capital partners on the back end being the actual banks themselves. And then we have connected with a finance provider who is in front of those banks and vetting every consumer and vetting every contractor. So the bank doesn't have to worry about that. And then in front of them is us making that technology fast and efficient.

Justus: So there's a couple of layers before you reach contractors and consumers and those don't really matter because the contractor and consumer are all that we really care about. So it can get extremely complex, but it doesn't have to. So what we've done is everything that matters to our consumers and our contractors is that it's fast and efficient. All of the back end is what we take care of. So realistically, we are looking to let a contractor select what they're comfortable using, so dealer fees that they're comfortable absorbing into their pricing or building into their pricing and products that make sense that their consumers would actually want. And then we let the system work its own magic to make it fast, to make it efficient, to let that consumer come in and do such a simple application to still get the full knowledge of what they're approved for and how quickly they can use it.

Heidi: Wow, that is great and to have so much complexity but have it be so simple, that's the key.

Justus: Yes. Precisely.

Heidi: So we have contractors who have been doing this for years and years and we have sales teams that have been offering financing. So how do you recommend, what is your advice for bringing this in front of a sales team training and what they need to start using this in the sales process?

Justus: Absolutely. So training a sales team is where it can become... It feels like it's a very overwhelming project because finance is complicated. And you want to present that to your sales team so that they can sell it confidently. But it becomes another one of those things of there's many layers behind the financing before it reaches a contractor and consumer. And there's a few more layers between the administration of a contractor's company and the actual sales force that's going to be presenting this financing to consumers. So that's where I step in and I try to work with contractors to do two things. A, select the right products and make sure that they know what they're comfortable working with and then presenting that information to the sales team. So we want sales reps to not be clouded by the compliance information on the back end or all of the different loan products that they could be offering.

Justus: We want to distill this information down to three or four loan products that we are going to present to a sales team to say, you have a six month no payment, no interest loan. So that's really good for anybody who doesn't have cash right this second but is going to get it. Or anybody who is working an insurance project. Hey, get your roof fixed today. You've got six months of no payments, no interest. You can work out with your insurance company. Once you get that payout, pay the loan off in full and you've avoided any interest. And then we have a fixed rate product, something really straightforward. Everybody knows how a fixed rate product works. Here's the monthly, here's the amount of time, here's your interest. That's all that the sales rep needs to know. And then maybe we have one guaranteed monthly payment product.

Justus: So we keep it very straightforward so that a sales rep can confidently walk in and say, I have three financing products. Most of the time those are going to cover everybody. So you walk in with that very simplistic understanding for the sales team, say straightforward products. If you get asked a question, these are the products that I have, these are how they work, this is who they're good for and leave it at that. The sales reps do not need to be finance professionals. They don't need to get any deeper into that. That's where again, me and my team stand, so that if they do have deeper questions, if the consumer needs something special, we're available to help out. The contractor, the admin team, the managers have been trained on the rest of the products, but for sales reps, it's critical to keep it simple, make sure that they know what they're selling and make sure that they can speak to them confidently.

Heidi: That makes total sense.

Justus: Yeah, that's where sales reps shine.

Justus: Get them to present the products they're comfortable and confident on and they'll sell them all day. A great salesperson can sell anything that they confidently know, so let them do that. Give them something that they can master quickly and then just incorporate into their sales process. The next step in my philosophy of selling financing is including it from start to finish. Though, we want to hit it early and often. When they come to your website, they should see that you offer financing. When they see an advertisement for your company, they should see that you offer financing. When they call in to schedule their very first appointment, they get their timing set up. We're going to send a sales rep out, that inside salesperson should ask them how they're planning to pay for this project. Not as a, do you need to finance this? You never want to ask somebody if they need to finance it, they don't want to tell you how much savings they have.

Justus: How would you like to pay for this because we do have options? You can pay with a check, you can pay with a credit card. We do offer in-house financing options if that's something you'd like to take advantage of. Not something you need, something you would like to take advantage of. And the sales rep comes out on site, Hey, I saw that you were planning to pay for this project cash. We do have financing options if you wanted to take advantage of them. Just to make the customer aware, you never want a customer to come and ask you if you offer financing because you never know that customer might not. Nobody likes to come and tell you that they can't afford something. So why would a customer want to have to call you or ask a sales rep, do you guys offer financing? We want to make that completely aware and present and not as an assistance, but as a solution. We're not helping out somebody who can't afford this project. We're helping somebody get the project they really want because we offer that solution for them.

Heidi: And that's where that upgrade came that you mentioned earlier. It makes it so much more possible for everybody to get what they want, that spectacular kitchen or roof. And that makes so much sense. Justus, thank you. Thank you. This has been phenomenal and you really have answered all the questions on how contractors can start doing this. They need to get with Roofle and Contractor Loan PRO and they're off to the races. You seem to make this very easy.

Justus: We have worked extremely hard to make this very easy. It is something that we as an organization are very passionate about. I personally am very passionate about. It's kind of my baby here at Roofle. We work diligently to make it simple, make it fast and always be available to help and to help improve it. So anyone who's looking for financing, anyone who is just looking for information on financing, I'd be more than happy to speak to them.

Heidi: Sounds great. Thank you. Thank you so much and I hope everyone out there... Wow, your discussion sheet has to be full. You have so many ideas now on financing. This is the future, and it is going to mean the contractors are technology forward. Consumers are impressed, and you're making it simple and easy for people to get what they really need for their home, which so important. So please check out the Roofle directory and see all of this information about Contractor Loan PRO and also be sure to go in after this and take that quiz so you can get your certificate of completion and entered in that contest. So Justus, once again, thank you so much.

Justus: Thank you so much for having me, Heidi. It was a pleasure.

Outro: It was great. And thank you all for listening. We'll be having our next Lunch & Learn next month, so be sure to join us and be sure to enjoy that lunch with all of your coworkers and these great conversations. Thank you so much. We'll see you next time on RoofersCoffeeShop Lunch & Learn.