TransCan Leasing Corp. (TCL) came about because of a giant void in the Canadian Auto Lending industry. The good part is that our banks are solid and well capitalized; the bad part is that there are not vary many of them – hence no competition. The same can be said for Auto Lease companies.
I have been a car dealer most of my life and operated 7 new car dealerships in both Canada and the U.S. After retiring, I did some consulting with car dealerships specializing in bankruptcy auto financing. There were several finance sources competing for this business. This made it possible for those in bankruptcy to get a late model vehicle at an interest rate below 20%, and to start rebuilding their auto credit.
When I returned to Canada and took a look at the auto financing available to those in bankruptcy or proposal, it was clear that there were only a few options and most of those, not very good. Not only were the rates very high (22% – 35%), but the debtor wound up in a very ugly catch-22. Financing in any form, even at extreme rates, was generally not available until 6 months after filing a bankruptcy or proposal. If you did not make your payments during that time, the lender would repossess the vehicle, and the debtor would be walking or taking the bus. If payments were made, often they were stuck with the previous vehicle after high payments, high rates, negative equity or the wrong vehicle!
They could make payments the next 5-6 years and yet none of those payments would do anything to re-establish their auto credit. After discharge, these clients would still be extremely limited in what kind of vehicle they could purchase and the rates would still be very high. Why … Simply because lenders want you to re-establish after filing for proposal, or after discharge from bankruptcy.
That is where TransCan Leasing comes in. TCL was created to fill the gap between bankruptcy and proposal by providing auto financing at fair rates – 11.9%. In many cases, TCL could charge much higher rates – we DO not. Why? At TCL we do not look at our clients as second-class citizens or average bad credit clients. These are good people that something bad has happened to. They have taken the steps and paid to get a fresh start. Good credit is important to them and we want to help,
That’s what TransCan Leasing is all about!
Greg Carter – Vice President – TransCan Leasing Corporation