KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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Are you looking at companies to finance your sale and installation? How does that compare to traditional alarm lending
October 20, 2021
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Are you looking at companies to finance your sale and installation? How does that compare to traditional alarm lending
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I was asked to review a program offered by a finance company to buy the alarm sale and installation, essentially financing the sale and installation. The alarm company would be able to contract separate for the after-install services. Sort of like Household Finance financing copy machines, aluminum siding, home improvement, appliances, etc. While I got to see the “Dealer Program Agreement” I didn’t see the actual contract that the consumer gets to sign for the installation, which I suspect is a form created by the finance company, used no matter what is being sold and installed. I wasn’t too keen on the idea because it seems to leave the alarm company unprotected contractually on the installation side. It’s also engaging in the retail installment business, which requires compliance with federal and state Truth and Lending Laws as well as consumer laws affecting retail installment contracts.
I asked Jim Wooster, who is in the business of financing alarm companies in what I consider an acceptable way. Here is his response, and as he suggests, I will schedule a webinar on this topic shortly.
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Ken,
Yes, I am familiar with Dealer Ally. It’s another in a growing number of residential "consumer finance" programs that have increased over the last few years largely as an alternative to traditional dealer programs like Moni and ADT. These programs separate the equipment financing from the monitoring RMR. The customer makes a monitoring payment directly to the dealer and a separate equipment financing payment to the consumer financing company, so maybe $35 to each. Then after some period of time the equipment is paid off and the customer is left only paying the dealer for monitoring.
To some dealer program dealers It makes sense as an alternative to selling the account since they can still get up-front cash without selling the account entirely. But, it is it not at all what we do. Our loans are “bulk” and start at $150,000.
Wonder if makes sense to do a KK webinar explaining the differences of each type of program:
- traditional dealer program
- bulk loans, lines of credit
- bulk purchases
- consumer finance
- loan against new accounts
Jim Wooster
Alarm Financial Services, Inc.
866-204-9350 ext 1200
415-509-4750 cell
jfwooster@alarmfunding.com
www.alarmfunding.com
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
www.KirschenbaumEsq.com
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