Accuracy, time savings drive e-contracting gains

Auto retailers and lenders are realizing more and more the value of electronic contracting. It’s not just the processing speed of e-contracts that’s appealing, it’s also the accuracy. And that can be a compliance safeguard.

When an F&I manager makes a data-entry error on an e-contract, the software prevents the manager from submitting the faulty document to lenders. When there are mistakes on a paper contract, the dealer and lender have to go back and forth to sort things out, not only opening up the possibility of a regulatory error, but wasting time and money as well.

Dealers seem to realize the benefits.

JM&A Group expects its e-contracting penetration to reach 60 percent of its contract volume by the end of 2016. Through October, 32 percent of JM&A’s contracts were electronic. But for all of 2014, only 12 percent were, and in 2013, JM&A did no e-contracting, Forrest Heathcott, president of JM&A Group, said during a visit to Automotive News last week .

“Dealers are very ready to adopt e-contracting,” Heathcott said. “It’s not as easy as it looks. It requires a good bit of work on both sides, both the pitching side and the catching side.

“But once the dealers get the equipment they need and the training they need, they love it. And the consumers love it as well.”

Plus, he said, “The accuracy is much better with e-contracting. It doesn’t require as many re-contracts and re-dos.” That not only saves retailers, lenders and customers time, it so helps dealers get funded faster.

For compliance protection, and for speed, it makes sense for dealers and lenders to latch on to e-contracting as soon as possible.

You can reach Hannah Lutz at