In recent years Canadians have been provided with a host of digital solutions for auto financing, but the speed and efficiency they offered was never made available to private sellers, until now.
Newly launched AutoArriba now looks to bring the same services Canadians have come to expect from dealerships and online auto lenders to peer-to-peer, private auto transactions.
“We provide a fully-automated, end-to-end digital solution to purchase a vehicle directly from a private seller without having to go to a bank,” explained AutoArriba vice president Galen Gower.
Previously, Gower says consumers could only secure financing for private auto sales through a bank, which could prove problematic.
“You could go into the bank and they could take three or four days to get the loan completed, and by the time you go back to the buyer the vehicle may or may not still be there,” he said. “Our process allows the consumer to apply, get approved and get money into the seller’s hand within a 24 hour period, all digitally without going to a bank.”
AutoArriba offers Canadians the option to purchase or refinance, and can provide a pre-approval or a specific amount of financing for a pre-selected vehicle.
“You either buy the vehicle first or you apply without a vehicle and get a pre-approval,” said Gower. “Once we have the vehicle information we’ll schedule an inspection with the seller within the next 24 hours, the inspector will send us a report back, and if the report says the vehicle condition is to the consumer’s standards we will generate the contract.”
That contract is provided electronically on the AutoArriba website or smartphone application, and can be signed digitally without requiring a bank branch visit.
“Once that’s completed there’s the seller agreement between the buyer and the seller,” Gower said. “Once that’s completed it binds the transaction, and we deposit the funds into the seller’s account, usually same day but always within 24-hours.”
The whole process typically takes under 24-hours and provides both buyer and seller with the same level of assurance and quality controls as traditional automotive transactions.
“The core problem for direct to consumer transactions is not only the access to funds but also the peace of mind,” he said. “Within our process we do an inspection with a third party inspection company to make sure it has all the options they say it does, the mileage is right, there’s no knocking in the engine—we do a CARPROOF® report that ensures there’s no large declarations on the vehicle, and we do a Lien search to make sure it’s free title.”
AutoArriba offers a range of solutions for prime to non-prime customers, with rates starting at 8.99% and topping out at 29.5%. Term limits can go as long as 84 months, with financing options starting at $3,500 and going up to about $50,000.
While AutoArriba has just launched in Alberta Gower says the company will expand across the entire country in the coming months, one province at a time. Though the startup is still small it is part of a $1.4 Trillion global banking group and owned by a major lender with decades of experience in the Canadian auto market.
As the company continues its expansion across the country Gower says they may look to add other products to their offering, particularly those that can further provide peace of mind to direct-to-consumer transactions.
“We’re looking at potentially offering after market products as well,” he said. “Does the consumer want insurance? Does the consumer want a warranty? We could even offer ancillary products, like loans in the non-auto space, that’s probably next on the horizon.”
For the meantime, however, AutoArriba is focused on providing dealership-like peace of mind and financing options to private auto sales in Alberta, and soon the rest of the country as well.