Floor Plan Curtailment

Using cash or a bank line of credit to purchase inventory can work for some car dealers but many floor plan financing companies offer a variety of dealer specific benefits.

Floor plan curtailment. Curtail plan for floor plan lending. Floor plan curtailment hi portphillipboat if you are unsure how best to record a transaction or the gst implications of that transaction i recommend speaking with your accountant as they will be able to provide you with the best advise as to how best to record this specific transaction. For new cars you want to set up your curtailment to coincide with the introduction of the next year s models. Floor planning flooring vehicles is a way to acquire inventory but it can have negative consequences if payments curtailments or payoffs are not made on time.

The dealer can change to another account if preferred. This booklet applies to the occ s supervision of national banks and federal savings associations. This booklet addresses the risks associated with floor plan lending and discusses risk management practices for floor plan lending. This usually happens around october.

The g l impact is a debit to 2110 notes payable a. Floor plan finance companies are uniquely attuned to the needs of auto dealers. Curtailment schedules vary by floor plan providers but they generally range from 5 20 of the original loan proceeds on each vehicle every 30 60 90 120 days. Curtailment is the act of restricting an activity or cutting it short.

Nsf s late curtailments slow payoffs and bad audits will inevitably prevent you from gaining the additional buying power you need to grow your business. Curtail plan for floor plan lending. The word has several common uses in business and banking services. In floor plan lingo curtailment is a fancy word that means amortization.

How does floor plan financing work specifically to benefit auto dealers. Ceo at a bank 363m usa does anyone have a floor planning curtailment plan included in the loan policy to share. The default credit is set to 1010 cash in house in misc 1 8 accounting.