American Pools & Spas
I believe credit is the single biggest hurdle at this point.
Last month we received 148 leads, a pretty decent number for this economy.
But what really hurts is our customers’ inability to secure financing. Many people simply don’t know if they can afford a pool because of worries over equity in their homes.
Even homeowners with 3- or 4-year-old houses may question their equity if another home down the street forecloses. It’s just a crazy mortgage market right now.
So we’re trying some unusual financing options that no one is really offering.
We’ve begun marketing a one-year-same-as-cash plan, meaning one year with no interest and no payments. It requires a credit score of 640 or better, and a decent debt-to-income ratio.
These two factors, if satisfied, will earn the consumer an unsecured line for $45,000 — the maximum loan amount.
The best part: The process requires no equity in the home.
It’s basically a win-win for the customers. Perhaps they’ll take the unsecured option at first. And if they realize later that they have equity in the home, they may refinance through that avenue instead.
We’ve also begun accepting MasterCard and Visa. While these transactions cost us a couple of points, it’s that much easier for the consumer to buy a pool.
In addition, we recently started running our first TV commercials. We’re promoting monthly payments “as-low-as,” in addition to the same-as-cash arrangement.
We’re certainly not marketing “Buy a pool for $15,000.” Price advertising is a loss leader; and besides, you rarely get buyers that way.
The lending program is a huge deal for us. We believe it’ll generate some business.
All in all, I think people want pools. And I hope this new financing option will get them off the fence and ready to buy.