How did LoanMart start out?
LoanMart was founded in 1999 as a small, family-owned pawn shop in Sherman Oaks, California. Within three short years it had diversified into title loans and began offering financial solutions through local business partners.
By 2007, the company had rapidly grown to a workforce numbering in the hundreds, necessitating a move to much larger offices in Encino, California. With a firm footprint in its home state, LoanMart started servicing Illinois and Arizona that same year. When New Mexico, Missouri and Utah followed in 2011, the company became a truly national presence.
Two years later and LoanMart began an ambitious sports team sponsorship initiative that eventually included the Los Angeles Dodgers and the San Diego Chargers. With the launch of the Low Vehicle Value program in 2014, LoanMart diversified its product line and strengthened its presence within the industry.
Now, with a new, larger location in Van Nuys, California, the company has a customer focused call center and centralized corporate office. Personal unsecured loans and the new ChoiceCash product supplement the company’s existing title loan range. A strengthening online presence includes social media and the MoneyTalk financial literacy website. Currently one of the largest title loan lenders in the nation, LoanMart has staked its reputation on being a reliable financial resource in times of need.
Describe the types of products that LoanMart provides.
LoanMart primarily offers secured personal loans to customers, using their vehicle as collateral. Most traditional lenders will qualify borrowers based upon their credit score and income; at LoanMart the borrower’s credit score is not a major factor as we place a greater emphasis on the vehicle value instead. This allows us the flexibility to lend to a much broader range of borrowers.
Within that space, we offer several different products, from our regular car title loan to our low vehicle value program. We’ve also recently launched a new product, ChoiceCash, which uniquely lowers the customers rate with every payment the customer makes.
For customers without a vehicle we also offer unsecured personal loans, which work in much the same way as a title loan but without requiring any collateral. Being unsecured, we can’t offer the same loan amounts but we’re still able to help those who need funding fast.
What types of problem does LoanMart solve for its customers?
The problems are many and varied, but typically our customers have an unexpected financial emergency and are in need of cash in a hurry.
That’s where we come in. We’re able to get the customer the money they need within hours of the customer first applying with us. We’re faster than traditional lenders and certainly much faster than the bank!
Realistically, we can help with almost any need as long as there’s enough equity in the vehicle and the customer can pay us back!
What unique challenges does LoanMart face as a company?
Let’s just be honest – the title loan industry doesn’t have a good reputation. Some see as us loan sharks, or at best, potentially exploiting people in dire financial need. We’re working hard to remedy that perception, but this obviously takes time.
Firstly, while it’s true that many borrowers come to us because they have a financial emergency, some come to us for happier events. For example, we’ve written a number of loans for engagements, weddings and vacations etc. Secondly, it’s not always true that our customers have poor credit and that they can’t borrow from anyone else. We’ve helped a lot of people with excellent credit, who could easily get money from the bank, but because of time constraints this simply isn’t an option.
We have a very open and honest policy when it comes our loans. We never “forget” to tell a customer the terms of the loan when they first qualify. Those same terms are printed in plain sight on the front of the contract. We don’t tack on additional fees or charges and we have no prepayment penalties so the customer is welcome to pay it off at any time.
Lastly, we emphasize that our loans are a short term solution. They are not meant to be kept for the full lifetime of the loan. These are simple interest loans, so we encourage our customers to make payments early, often and more than the agreed amount so they can get the loan paid quickly and for less interest than they agreed to.
What sets LoanMart apart from its competitors?
Since the financial crisis ten years ago, borrowers have found it harder to get the money they need and, as a result, the title loan industry has really boomed in the past five years or so. LoanMart has been offering title loans since 2002, six years before the economic downturn, so not only are we one of the pioneers of the industry but, having weathered that financial storm, we’re one of the most secure.
Besides our longevity, four out of ten customers return to us, making us one of the most trusted lenders on the market.
What unique marketing challenges does LoanMart and others in your industry have?
The biggest problem is simply awareness of our product. A lot of people aren’t even aware they can use their vehicle’s equity to get cash, so when they need money urgently they don’t know who to turn to. If you don’t know something exists, you’re not going to look for it. We have a small target customer base and we obviously try to target the market effectively, but we struggle to reach the right people at the right time.
Since I joined LoanMart in 2016, we’ve realized two consecutive years of near double digit loan growth while reducing the marketing spend by almost 30%. I feel we’ve made some headway in overcoming our challenges but we still have a way to go!
What does a typical LoanMart customer look like?
There isn’t a typical LoanMart customer! Our customers vary by race, age and income and with a wide range of credit profiles. They can use the money for almost any reason, so as long as their vehicle has the equity to get them the cash they need, we’re usually able to help them out. We’ve helped everyone from single parents to entrepreneurs with credit profiles ranging from poor to excellent. They’ve needed money for rent, vacations, engagement rings and inventory and have used almost every car imaginable as collateral – including Maserati’s and Lamborghini’s!
What do you think it is that makes LoanMart successful?
I think it’s pretty simple really; it comes down to satisfying the needs of our customers. Not only have we made it very quick and convenient for people to apply, but also for them to get their money the same day.
Beyond that, we don’t operate any company owned brick and mortar locations so we don’t those additional overheads. We’ve teamed up with a large network of partner stores that provide cash within a few short hours of getting approved. So if the customer needs money today, they can get it today – they don’t need to wait for a check to clear or for an ACH deposit to go through.
At this point, we have this down to a fine art! Our originations team members are experts at qualifying the customer and finding them a nearby location that can immediately provide them the cash they need.
What would be LoanMart’s spirit animal?
A St Bernard dog! We’ll come to your rescue when you’re snowed under – but we can’t bring you the brandy!
What are some of LoanMart’s goals for 2019?
I think this year should be one of the most significant in the company’s history as we’re looking to enter a number of states we’ve never previously served. Similarly, we’re looking to expand our ChoiceCash product by making it available across a number of new territories.
Where do you see your industry in 5 years?
There’s obviously a major push toward the increased use of mobile technologies and LoanMart intends to maintain its position at the forefront of that technology. Borrowers can currently qualify for a loan and upload their documentation through our app; we’re now moving toward the customer completing the process and receiving their funding through that app too.
Ultimately the cornerstone of our business will remain unchanged – helping our customers in their time of need!