Using Homeowner Financing Options To Grow Your Roofing Business

As a business owner, one of the hardest parts when selling a project is closing the sale. Many times, when faced with the cost of a roofing project, homeowners are surprised and overwhelmed by the total cost of the job, causing them to push back or say “no” to your project.

The reality is that there aren’t many customers who have the cash to pay upfront for a roofing project, and as a contractor, you need to be aware of this. If you are looking for ways to increase your sales and generate more profit, then you need to offer your customers attractive financing options that will allow them not only to say “yes” to your project, but to even include upgrades that they wouldn’t have considered before, thus increasing the size of the project and your profit.

Why contractors should use home improvement financing

There are several reasons why you should offer financing to your customers. Having this option puts you more in control of the closing process and helps you increase your close rate because you can offer it right in the customer’s home. It may also increase your revenue overall by providing your customers with a variety of flexible payment options for the work you recommend along with potential upgrades. For instance, a homeowner who is presented with an upgraded home improvement project and an accompanying lower-than-expected monthly payment will most likely spend more money. This similar scenario plays out with credit cards. Homeowners behave similarly, agreeing to upgraded projects when financing is offered compared to paying cash.

By partnering with a home improvement financing company, you also can ensure that you get paid upfront for the project, rather than trying to arrange for payments over time directly with your customer. The financing company pays you in full right away, while the customer can pay over time. This is especially important as just about everyone is on a tighter budget these days. With a relatively large expense, such as a replacement roof, even if it is planned in advance and not due to an emergency, the homeowner gets the advantage of fixed monthly payments over time to help ease the burden.

Most homeowners have no idea of the cost of a roofing project or how much they can afford. By working with a financing company, you can be one step ahead by having a financing option available before even stepping foot in their homes.

Benefits of contractor financing for roofing businesses

• Increase your sales close rate.
• Guaranteed payment, less risk.
• Increase your profitability by increasing the size of the projects.
• Become a preferred and more valuable option for your customers.
• Faster homeowner decision-making, potentially during the initial visit.

Benefits of contractor financing for homeowners

• Homeowners have an easier decision-making process.
• Flexible payment options.
• Removes budget constraints, which allows them to afford larger projects.
• Earlier start and finish dates for their home improvement project.

How to partner with a home improvement financing company

There are multiple lending companies in the market, so it is important that you do your own due diligence and consider what they offer to your business and how you could benefit from partnering with them in the shorter and longer terms. As a business owner, you need to make sure you choose the right partner.

Some features to consider when evaluating financing partners are:

• Take time to understand and review how the financing program works for you and for the homeowner.
• Some financing companies charge fees to contractors for using their services. Our ROOFPRO members have access to homeowner financing partnerships with attractive discounts and reduced fees.
• Determine if they offer you marketing resources and training to help grow your business.
• Privacy and Security. Remember to ask about the company’s privacy policies and how they protect your data.

Most financing companies will ask for some documentation on your business to get you approved as a partner, and requirements vary. Once the vetting process is completed, and you are cleared, you will have access to the resources and tools to start offering financing as part of your sales pitch to your customers.

Best practices when offering financing

Always remember to integrate financing as part of your sales proposal. When talking to your customer, you will want to mention the different payment options you offer in advance. When presented with attractive fixed-payment options, customers are often persuaded to proceed with the project and perhaps even consider upgrades, resulting in a bigger project for you. Think about it like credit cards — people tend to make quicker decisions and spend more money when they use their credit cards. As a business owner, you want to use financing as a customer benefit for doing business with you. Make financing a part of your presentation, not a separate discussion, to help inform, guide and ease your customers in their decision-making process.

Offering homeowner financing options can be a great pathway to increase your sales, project size and revenues, and, ultimately, to grow your business. Visit the Partner Page on the IKO ROOFPRO portal to review a list of financing partners available.