Common Contracts
1 similar Substitution of Collateral Agreement contracts
Substitution of collateral auto formSubstitution of Collateral Agreement • September 27th, 2023
By Amir Dabiri - July 2, 2014 In a Buy Here Pay Here Dealership a collateral exchange is a transaction that takes place quite often. A collateral exchange refers to one vehicle being substituted for another vehicle for a customer. In most states, this agreement does not change any other aspect of the original Retail Installment Contract. Also, any payment history on the previous vehicle remains the same. It is simply a ‘swap’ in vehicles, or ‘collateral’. So what kind of scenario would generate a collateral exchange? As a dealer, you will always have your problem cars that customers will continue to bring back after the sale due to mechanical errors. At some point in time, it may be better for you to switch out that collateral for the customer. Not only does this save you the hassle, but it could also save you money in the long run. A collateral exchange is just one of many types of transactions that a BHPH dealer may be faced with. It is important to be sure that your Dealer Managemen
