Better Together -- Shalva Moore, third from right, was able to buy a 2016 Camry from Toyota of Richardson after working with the On the Road Lending program. Pictured from left, Al Smith, group vice president, Toyota Social Innovation; Michelle Corson, founder and CEO of On the Road Lending; Toyota of Richardson salesman Gary Lowe; and Brian Pacheco, sales director.
When Shalva Moore first heard about the On the Road Lending program, she thought it was too good to be true. The widowed mother of three didn’t think she could find an affordable loan for a reliable used car with her credit rating.
Now, not only is she driving a 2016 Camry, but her budget and outlook have improved with financial counseling and ongoing support from the nonprofit program.
“It’s changed my whole attitude about my finances,” she says. “They’re like a family with the learning and encouragement they’ve given me. They’re good people.”
Moore is one of about 150 low-income On the Road Lending clients who’ve benefited from vehicle selection assistance, low-interest auto loans and long-term financial mentoring. OTRL meets needs for individuals who otherwise wouldn’t qualify for mainstream financing.
“We truly believe that a better car leads to a better life,” says Michelle Corson, founder and CEO of Dallas-based On the Road Lending. “We want our clients to have affordable transportation so they can get to work and lead a healthier life.”
Toyota of Richardson has worked closely with the nonprofit since it launched in Texas four years ago. The suburban Dallas dealership sells about 12 cars monthly through the program, compared to two when it first started. But these deals are about much more than selling cars.
“What we found is that it makes a huge difference for people who have been through difficult circumstances,” says Brian Pacheco, sales director at Toyota of Richardson in Richardson, Texas.
“Especially in our market where you must have reliable transportation to hold a job and take your kids to school. Being able to sell cars and do something good (for the community) makes my salespeople feel like they are contributing. They can see how it’s changing lives.”
Corson says Toyota of Richardson treats her clients well and values not only their time, but the relationship.
“Toyota of Richardson is respectful of our clients’ time and takes good care of them,” she says.
On the Road Lending transactions are straightforward for the dealership because the numbers are locked in and paid by the organization, which is funded by private equity.
“Although we are not a bank, we function like one from the dealer’s perspective. We give the check to the dealer, so it works like a cash transaction,” Corson says.
Adds preowned salesman Gary Lowe: “As a salesman it gives me a good feeling to put them (clients) in a nice car that is properly maintained.”
A Different Model
The character-based lending model doesn’t rely on credit scores, which are often an issue for low-income borrowers. Instead, applicants — who so far have numbered 1,200 and are typically referred by social service agencies — write a personal essay.
“We can’t make a loan to every person who wants one,” Corson says. “But through the essays, we look for those who are resilient, motivated, thoughtful and honest. It takes a lot of courage to put that on paper.”
Moore’s story got Corson’s attention. Her husband suffered a series of strokes and health issues, making it difficult for her to maintain steady employment. She only began driving after he died, and has since been able to secure a good job and keep her kids in college.
So far, the program has only had three defaults, which Corson credits to the long-term client relationship.
“We can stay really close to our clients through the life of the loan,” she says. “If someone loses a job we can defer payments or let clients pay less. We have a donor fund that helps buy car seats and new tires to help keep children safe. We don’t want anyone to lose the car, so we’re going to work with them.”
Corson plans to slowly expand the program to other states. It will be easier with a $1 million grant that Toyota made in May to improve processes, build IT infrastructure and expand services. Toyota also will be sharing principles on how to improve productivity and maximize resources at the nonprofit.
“Shalva’s story is a great example of how our dealers and nonprofit partners can come together to make opportunity possible, strengthening ties in the community and helping to improve quality of life,” says Al Smith, group vice president, Toyota Social Innovation. “When we join forces with others to tackle problems, we can come up with solutions that are better than anything imagined on our own. We look forward to helping expand this program.”
Moore admits her skepticism initially kept her from applying for the program, but it’s been a game changer for her family.
“I was scared to jump into a car loan,” she says. “But I’m glad I did. I love my Camry. And the financial coaching is really good. You can change a whole lot if you put your mind to it.”