Dealers are losing sales, F&I penetration and gross profit because of initial quote-to-final terms gaps, according to a new eLEND Solutions survey, with most final lender monthly payments decisions much higher than initial dealer finance quotes
FOOTHILL RANCH, Calif., Nov. 4, 2025 /PRNewswire-PRWeb/ -- A new report from eLEND Solutions underscores the negative impact that mismatches between initial quoted payment terms from auto dealers, and lender fundable contract terms, can have on sales and gross profits, while also revealing a significant opportunity for the auto retail industry – an estimated $515,000, on average, per dealership, per year – if the problem is solved.
The survey was fielded online among U.S. dealerships and F&I industry professionals to validate eLEND Solution's recent analysis of thousands of consumer credit applications that compared initial finance terms offered to consumers by auto dealers to actual auto lender decisions received for the same customers. Survey respondents resoundingly agreed with the findings that lender-approved monthly finance payments are, on average, at least $32 per month higher on new vehicles – and $36 per month higher on used vehicles – than original initial terms quoted to consumers by dealers. And that does not include dealer mark-up or increased down-payment requirements.
"With the vast majority reporting that lender terms come in much higher per month than the initial quote, it is not surprising that 60% of credit applications submitted to auto lenders do not receive credit approval decisions. Car buyers are receiving inaccurate initial information that is significantly undermining the customer experience," said Pete MacInnis, Founder and CEO of eLEND Solutions.
With affordability top of mind, today's car buyers are focused on payment terms as much as price, but their expectations are not being met because of gaps in quote-to-payment terms. These disconnects, according to the survey, mean that up to 30%, or more, of new vehicle sales have to be re-penciled, with the majority of respondents saying front-end gross profit is reduced in order to resolve friction.
"It is no wonder that 93% of those surveyed say sales are lost as a result of the quote-to-payment-terms gap, nor that front-end gross profits are diminished, time spent in F&I is increased and finance penetration is negatively impacted," continued MacInnis.
A key culprit of the quote-to-terms gap is identified in the survey: the majority of respondents estimate that over 50% of lenders no longer provide auto dealers with standard rate sheet bulletin guidance which offer FICO Credit Score tier as the single attribute to determine base loan pricing. Without these bulletins, dealers are flying blind in quoting qualified payment terms during the sales negotiation and, according to MacInnis, this is a direct result of lenders evolving to an AI-based dynamic pricing down to the individual customer qualification level.
For example, a loan-pricing model provided by AI might start with a combination of attributes such as credit score plus length of credit history, high credit, percent of revolving utilization, payment and debt-to-income ratios, stability factors etc. to determine base loan pricing. Then, the AI-based lender underwriting guidelines may adjust loan pricing based on year of vehicle, term, front and back-end advance, loan to value, mileage plus a limitless number of attributes in each lender's AI-based black box loan decision engine.
"But, every dark cloud has a silver lining," said MacInnis. "If the issue can be solved, the opportunity is significant." Leveraging survey data and the credit application analysis, eLEND Solutions estimates the lost sales revenue opportunity per dealership, per year, could average $237,000, and the lost F&I revenue opportunity $278,000, equating to an average lost profit opportunity of over $500K per dealer per year.
"If lenders' proprietary AI-based loan programs move forward in the sales negotiation process, so they integrate into a finance first (not last) process, the mismatch gap could end – to the tune of an estimated $4.7 billion annual opportunity for franchise auto dealers. Isn't it about time our industry came together to claim it?" concluded MacInnis.
KEY SURVEY DATA HIGHLIGHTS
- 82% agreed that less than 40% of credit applications submitted to auto lenders receive credit approval decisions.
- 83% agreed that lender finance approval decision monthly payments for new vehicles were on average $32 per month higher than the initial offer to the customer.
- 88% agreed that lender finance approval decision monthly payments for used vehicles were on average $36 per month higher than the initial offer to the customer.
- 87% of respondents say that front-end gross profit is reduced for used vehicles, when lender approval decisions are $36 higher than initial quote – by $300 or more say 56% of these.
- 85% say that new vehicle deals have to be reworked because of initial quote to lender term mismatches. Of these, 2 in 5 say that 30% or more of total new vehicle sales have to be reworked
- 87% say the number of lenders who have ceased providing standard rate sheet bulletins, has increased, with the majority (54%) estimating that over 50% of lenders have discontinued this practice.
- 40% say resolving payment term discrepancies adds 31 to 45 minutes or more to the sales and finance process.
- 78% estimate that finance penetration could increase by 11% or more if initial payment quotes matched lender decisions before getting to the F&I office.
METHODOLOGY
Survey Methodology: Nearly 150 automotive dealers, allied F&I industry personnel and auto lenders across the U.S. participated in this online survey which was fielded by eLEND Solutions in August 2025.
TO ACCESS/DOWNLOAD THE FULL REPORT, CLICK HERE.
ABOUT eLEND SOLUTIONS
eLEND Solutions™ (AKA DealerCentric Solutions®), is an automotive FinTech company providing a vendor neutral, API-based middleware solution for true end-to-end connected retailing. Our solution bridges the gap between shopping and buying – delivering transactable, lender-matched payment options and funding scenarios at the point-of-sale, online and in-store. The platform specializes in hybrid credit, identity verification, and 'pre-desking' finance solutions. By changing when and how the shopper is introduced to realistic payment information and dealership financing options, the combination of technology and data enables the dealer and the customer to come together much faster – and more profitably.
Media Contact
Crystal Hartwell, eLEND Solutions, 1 714-987-1016, [email protected]
Melanie Webber, eLEND Solutions, 1 949-307-1723, [email protected]
SOURCE eLEND Solutions
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