What’s the difference between a ‘Hard Close’ and a ‘Strong Close?’ by SecureClose
The point of the closing is to clearly communicate the terms of the loan and the responsibilities expected of your customer.
I am reminded of the ”Hard Close“ when I was coming up in the auto business and being trained on how to present the closing documents to a customer. If the loan seemed riskier, the managers would always say, “Make sure you close them HARD!,” as if something I said to them during the close would have an influence on their ability to pay when the car broke down or they lost their job.
Intimidation tactics or threats, the basis of a “Hard Close”, do not make customers better payers.
A “Strong Close” delivers a message that is clear, transparent, and consistent which can improve the likelihood of success with the customer. Do not leave room for interpretation or any ambiguity when reviewing any terms and conditions with the customer.
A “Strong Close” incorporates communication techniques we believe increase the chances for success when the customer has financial or mechanical issues during the term. A strong close along with affordable payments, and a strong service contract/warranty gives the consumer a better chance to stay on track when things go south.
It is essential for the customer to understand the intent and purpose of the Retail Installment Sales Contract (RISC) before they sign it. During the closing, it is important to ensure active listening, avoid any distractions, stay on point, and use a friendly tone of voice to ensure clarity.
These qualities are the foundation of our closing software and the reason we have been so successful.
Along with clarity and intent, make sure you have a robust Fair Lending Policy and Underwriting policy that emphasizes the importance of treating all people equally, and have a documented training strategy that implements and reinforces these goals.
With today’s consumers being more educated than ever, the bullying tactics of a “Hard Closing” just won’t cut it anymore – if they ever did at all! A “Strong Closing” on the other hand leads to a more confident and educated buyer, which in turn gives both them and your business the best chance to succeed together!
