Introduction
Carmel Financial Corporation is an emerging leader among secondary lenders in the United States.
By extending credit to people who otherwise would be rejected by primary lenders, Carmel Financial Corporation boosts its participating merchants’ bottom lines. The company’s service has established it as a dominant fixture in the in-home water treatment industry, and made it a growing force in the exterior home improvement products industry.
“We Make It Possible,” the company tells its member merchants and customers, as it facilitates sales or purchases that might have been cancelled for lack of financing.
Company overview
Founded in 1967 as a sales distribution company, Carmel Financial Corporation began simply, with a single $8 payment, according to Carmel Financial Corporation Founder, CEO and Chairman of the Board Tom Sheehan. The check, he recalls, was the first monthly payment for one of the sets of encyclopedias he sold door-to-door through his sales distribution company, Universal Distributors.
Working face-to-face with countless families, Sheehan realized that many needed a second chance for affordable financing. Using his own capital, Sheehan began offering credit for customers of Universal Distributors (which he grew to be one of the largest independent distributors of encyclopedias in the United States).
However, Sheehan quickly realized there was a need for the same service for other important products.
Now, thousands of customers later, Carmel Financial Corporation is a major, nationwide secondary lender, financing higher-risk credit applicants for the purchase of everything from in-home water treatment systems to replacement windows to heating and air conditioning units to above-ground pools and spas.
Carmel Financial Corporation works with participating merchants to assist consumers whose financing applications are rejected by primary lenders. The company promises to accept every applicant, in exchange for a discount that varies depending on customer risk. The arrangement helps merchants make a sale they otherwise would have lost because the customer couldn’t secure financing.
At a time when more consumers cannot make the grade with primary lenders, Carmel Financial Corporation offers its participating merchants the opportunity to make some money instead of no money. “Some profit is better than no profit,” says Sheehan.
Secondary lenders help boost the bottom line, Sheehan explains. They aren’t responsible for the bulk of a business’ profits, but they do add to them. “It’s extra money,” he says.
Sheehan introduced pioneering computer software to Carmel Financial Corporation’s operations in the early 1980s. While computers continue to play a vital role in evaluating customers, all applicants are reviewed on an individual basis. The practice reflects Sheehan’s philosophy that customers should be treated as well as he and his employees expect to be treated.
Carmel Financial Corporation also mirrors the values of its company president, Tracey Sheehan, Tom Sheehan’s daughter. A former Division I women’s basketball coach, Tracey Sheehan emphasizes a strong team approach to the company’s operations.
Carmel Financial Corporation is an active member of its central Indiana community. Since 1992, the company’s employees have conducted special events to raise money and other donations for a local food bank. In fact, Carmel Financial Corporation’s more than 80 employees now help to donate more than 50,000 items each year to the charity.
History
• Working with member merchants, Carmel Financial Corporation helps businesses complete sales transactions they otherwise would have lost when customers fail to secure financing from a primary lender. Purchase of the sales contract, however, is offered at less than the full sale price to cover the risk of extending credit to a customer with a higher probability for default.
• A nationwide lender, Carmel Financial Corporation ranks among the dominant secondary lenders for the in-home water treatment industry.
• The company now offers financing for the purchase of a wide variety of products for the exterior home improvement industry, as well as for the purchase of items such as above-ground swimming pools, spas, tanning beds and heating and air conditioning units.
• As a secondary lender, Carmel Financial Corporation offers a “second” chance for people to obtain products they need as well as re-establish their credit history.
• The privately owned company relies on complex, proprietary computer analyses to assess risks of financing customers, however, each applicant is reviewed on an individual basis.
• Carmel Financial Corporation has extended financing to thousands of customers throughout the United States. Its wholly owned subsidiary, American Accounts Management, serves as its full-service collection agency.
• Founded as Universal Distributors, a sales distribution company, Carmel Financial Corporation was later incorporated to offer financing to customers who wanted to purchase the company’s encyclopedias, but couldn’t obtain credit from a primary lender.
• Unlike predatory lenders, Carmel Financial Corporation charges the same interest rate as many primary finance companies.
• Located just northeast of Indianapolis, IN, Carmel Financial Corporation employs approximately 80 people.
• Carmel Financial Corporation celebrates its 40th anniversary in 2007.
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