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Business Solutions

Dealers must verify the existence of the business by obtaining and reviewing the following information by type of business entity prior to submitting the credit application to TFS:

Sole Proprietorship
A sole proprietorship is set up to allow an individual to own and operate a business by him/herself. A sole proprietor has total control, receives all profits from and is responsible for taxes and liabilities of the business. In most States they have no filing with the Secretary of State (SOS), but usually have a Fictitious Name Filing with the County (commonly referred to as a "dba"). Searches for Fictitious Name/dba filings are available on most County web-sites. Since sole proprietorships have unregistered trade names without any formal form of an organization, Business Solutions credit applications will be reviewed and analyzed according to the credit status of the individual.

Verification:

Copy of Fictitious Name Filing (or verification of active name from County web-site); or
Copy of applicable "Schedule C" from most recent tax return to support existence of the sole proprietorship; or
Copy of current Business License

Documentation:

Signed Business Credit Application (with SSN# listed under Tax I.D. number)
Name; "dba" name must be listed as the primary applicant/buyer/lessee;owner must be listed as co-applicant/co-buyer/co-lessee

Example: if sole proprietorship is "John Smith dba John Smith Woodworking"

Applicant: John Smith Woodworking
Co-Applicant: John Smith

All signatures should just be proprietor's name

Corporation
A corporation chartered by the state in which it is headquartered is considered by law to be a unique entity, separate and apart from those who own it. A corporation can be taxed, it can be sued, and it can enter into contractual agreements. The owners of a corporation are its shareholders, officers and director(s). Officers and the Director(s) are listed on the Articles of Incorporation (or supporting documents).

Verification:
Copy of articles of Incorporation (or verification of active name from SOS). It is imperative that the name of the Corporation as stated on the credit application be verified and that the name of the entity on the retail contract or lease agreement be identical (including capitalization and punctuation) to the name shown on the Secretary of State's records.

Documentation:

Signed Business Credit Application (with SSN# listed under Tax I.D. number)
Legal Name & Trade Name (dba) must be listed on Application
All signatures should just be ‘Legal Name’ by (Officer/Director).
Corporate Resolution & Incumbency Certificate (7175)

General Partnerships
In a Partnership, two or more people share ownership of a single business. Like proprietorships, the law does not distinguish between the business and its owners. The partners should have a legal agreement that sets forth how decisions will be made. General Partnership statements are not always filed with the Secretary of State's Office, so the Partnership Agreement needs to be obtained to verify the legal name and officers.

Verification:

Copy of Partnership Agreement; or
Copy of Fictitious Name Filing (or verification of active name from County web-site)

Documentation:

Signed Business Credit Application (with Tax I.D. number)
Partnership Name & Trade Name (dba) should be listed on Application
All signatures should just be ‘Partnership Name’ by (Partner)
Partnership Resolution & Incumbency Certificate (7177)

Limited Partnerships
Most of the partners have limited liability (to the extent of their investments) as well as limited input regarding management decisions. In CA (and other states), Limited liability partnerships may only be formed by licensed persons for the practices of public accountancy, law or architecture. Limited Partnerships are required to register with the SOS (in most states).

Verification:

Copy of Partnership Agreement (or verification of active name from SOS), or
Copy of Fictitious Name Filing (or verification of active name from County web-site)

Documentation:

Same as for General Partnerships (above).

Limited Liability Company
The LLC is a relatively new type of hybrid business structure that is now permissible in most states. It is designed to provide the limited liability features of a corporation and the tax efficiencies and operational flexibility of a partnership. The owners are members, and the duration of the LLC is usually determined when the organization papers are filed.

Verification:
Copy of Articles of Organization (or verification of active name from SOS). It is imperative that the name of the LLC as stated on the credit application be verified and that the name of the entity on the retail contract or lease agreement be identical (including capitalization and punctuation) to the name shown on the Secretary of State's records.

Documentation:

Signed Business Credit Application (with Tax I.D. number)
Legal Name & Trade Name (dba) should be listed on Application
All signatures should be ‘Legal Name’ by (owner/member)
LLC Resolution & Incumbency Certificate (7176)

** The business entity descriptions contained herein are intended to provide high-level overviews and are not necessarily complete legal definitions for each entity for every state. Since each state has its own laws on business organizations, you should refer to that state's information for specific definitions and descriptions.

Financial Documentation
The credit decisioning process can be more complex for business requesting a VCL than individual consumer applications, so please allow for additional approval time. However, once approved by TFS, the VCL is good for 12 months and will help streamline the credit review process and acquisition of future vehicles.

For VCL requests from $100k-$500k, your DSSO may require additional financial information from you and your business customer. Sometimes, a personal guarantor is required.

For VCL requests over $500k, your DSSO may typically require audited Financial Statements (balance sheet, income statement, and cash flow statement) for the 2 previous fiscal years.* Sometimes, a personal guarantor is required.

*based on financial statements, additional questions may be asked and additional information may be requested

Credit Application Submission Process:

Determine if the credit application is for Business with Co-Applicant (BC) or Business (B) only and submit via Route One accordingly.

Add comments in Route One that a VCL is being requested, including the dollar amount.

Ensure the submitted application is complete and accurate

Dealership personnel must verify the correct legal name of the entity and ensure that all documents are accurately completed/signed.

Ensure that all required documentation is provided to the DSSO

Refer to the ‘Dealer Instructions’ section above for the documentation required for each type of business entity.
Note: Additional documentation may be required to initially set up a VCL, but most likely will not be required on subsequent transactions.

Credit Documentation Requirements:

Standard Retail, Lease and Preferred Option documents are required. Wherever possible, Business Solutions Retail and Lease contracts should be used. Non-Business Solutions contracts will be accepted, as long as the ‘Business’ use box is checked on the form, as applicable.
‘VCL Rebate’ must be denoted on the Dealer Funding Checklist.
All applications must be denoted ‘VCL Rebate’ in the upper right hand corner.

Rebates are only available on contracts that are actually booked with TFS.

Business Solutions

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