Finance Options as a Remodeling Service (PR Podcast)

Key Highlights

• Flexible financing options are crucial for closing leads and expanding project sizes in the current remodeling market.
• The industry faces challenges like rising costs, labor shortages, and private equity competition, which financing can help mitigate.
• Revolving credit programs, like the Home Projects Card, encourage repeat business and support smaller, ongoing projects.
• Understanding how to incorporate financing into overhead costs is key to maximizing its benefits and increasing sales.
• Consumer sentiment analysis shows increased demand for financing as a tool to manage economic uncertainty and project costs.

In a panel discussion at our Annual Pinnacle Experience Event, senior editor Jay Schneider assembled a small panel of finance professionals to discuss with the audience finance options worth offering and how they can not only win jobs but also make them bigger.

Transcript:

"Every lead is so darn important right now that you have to have the options to close. And if you don't have those options, you know—you’re gonna be in a world of hurt."

Hello, and welcome to the Pro Remodeler Podcast. I'm Jay Schneider, senior editor with Pro Remodeler, and this episode is pulled from the 2025 Pinnacle Experience Conference. I am with Ron Kammes—almost said Thomas, sorry—Ron Kammes, regional sales manager at Synchrony Financial. And I told you I'd probably call you Thomas.

And then Andrew Burbank, who is the senior relationship manager at Wells Fargo. Good morning. Thank you very much for joining us today. I want to open this up by saying, why don't you tell us—or tell everyone here—about what it is that you do and the services you offer to the remodeling community.

Ron Kammes: Synchrony Financial used to be GE Capital, and about 10 or 11 years ago, we became Synchrony. GE started consumer financing back in the Great Depression. So we’re in consumer financing. We've been specifically in the home improvement industry for about 35 or 40 years now. And so that's really the goal of Synchrony—to help our partners sell larger projects through financing. And that's what we do with a partner-focused approach.

Andy Burbank: We do similar to Synchrony. We've been around since Abe Lincoln and the stagecoach. As far as financing, it's really there as a tool. Yes, it's gonna help you close more jobs, but also increase your ticket. So at the end of the day, it makes you more money. And that's what we're here in partnership for—you guys, right? Because if you're not growing, you're probably dead in the sea after a while. So you're always looking for opportunities to grow, and this is just one more tool.

Finance options for remodeling professionals

Jay: Let's talk a little bit about financing. Some of the issues facing the industry are rising costs of home improvement projects driven by inflation, labor shortages, and material costs. Are you also seeing other trends, or how are you addressing some of those issues?

Ron: Yeah, so I think in this environment, the key is really our flexibility as a company. We're really trying to meet all of our partners where they are and help them, whether it's a very small mom-and-pop or a very large home improvement business. We want to meet them where they are and help them with what their specific needs are.

And the way we do that is Synchrony has a variety of products now. We actually recently acquired Ally Lending last year. We’re rolling out an installment product later this year, so we're really excited about that. It's in a testing phase right now. That gives a multi-product option for our partners. We also have a direct partnership with Fora for second-look lending. So if you tend to be in a tougher demographic area where Synchrony can’t approve that applicant, we have a direct waterfall to Fora—they’ll do that immediately, right away as well.

Just a lot of flexibility, I think, to meet the needs, because the important thing is every lead is so darn important right now that you have to have the options to close. And if you don't have those options, you're gonna be in a world of hurt. It's a unique environment right now, with the challenges that everybody knows about and that we’ve talked about over the last couple of days. I think flexibility is the key for us.

Andy: Yeah, I'd a hundred percent have to agree. I look at financing as a tool. If you look out there over the last 50 years—what car dealership doesn’t have financing? It might be a no-interest-for-five-years deal. It might be an 8.9 APR. But if one car dealership had financing and the other didn’t, how many do you think would go to the one that does?

The people that have the money—they don’t want to spend their money. Example: the $80,000 Denali truck they can get for five years. You put it in a CD at 6%, 4%, right? You're making money. A lot of people think of financing as a last resort. I look at it as an opportunity to increase and grow your sales—especially for those customers that have the money. They're the ones that don't want to spend it.

As far as Wells Fargo, we're a revolving line of credit, which is good and bad. For your jobs that are $8,000 or so, the closed-end product—the product that Synchrony is rolling out—that’s more geared toward that or more of your $60–65,000 and lower kind of job tier. For some of you, that may not work, right? Because I know you do $150,000 jobs. You're not in that tier. For others, absolutely. But maybe you have a business where 30–40% of your smaller jobs are $20–30,000. There’s opportunity there too.

Like a credit card for home improvement

Jay: I'm gonna stick with you, Andy. You said that you have a new program called the Home Projects Card. Do you want to talk a little bit more about that?

Andy: Yeah. So it hasn’t been around since Abe Lincoln and the stagecoach, but it’s been around for a while now. And again, it’s a revolving line of credit. What it is—it’s a way to bring back business. One thing a lot of remodelers have, especially those who do smaller jobs, is repeat business. The customer comes back to have other things done in the home, and with our card, they can get approved, they can use the card, and as long as they use it within 18 months after their promotion’s paid off, they can continue to come to us—come to you—and not have their credit pulled again.

They can use the card for multiple things—like closet organization—and then they could go the next year and go to HVAC, and then maybe the next year—or the same year—they go to remodeling jobs. That card’s really built for those job leads, but also to bring back business to you guys.

Ron: Yeah. Similar to what Andy was talking about, our main programs are revolving products, right? And so we want multiple use on that card. But what we’re seeing recently—obviously we still have our traditional larger projects: roofing, siding, windows, and that sort of thing—but because the economy’s a little bit tighter, we’re seeing a trend toward what we call handyman projects being financed.

So even smaller tickets—maybe a $2–3,000 gutter job or a small ticket—those things are being financed more often now, whereas in the past, people would just write a check for that a little easier.

With our program, similar to Wells Fargo, ours is a private-label credit card, so you can’t use it—it doesn’t have a Visa logo on it. You can’t use it at Walmart or that sort of thing. But the idea is repeat business. Maybe a remodeler’s going in and doing one of those handyman projects for just a few thousand dollars, but they get the Synchrony card in their wallet, and then they’re prepared for that next larger project down the road when they’re financially a little bit more ready for it.

The financing would help them do that initially anyway, but it just gives them more peace of mind. They maybe handle a smaller project first and then knock one off their to-do list later with that card.

Jay: Now, Andy, I’m gonna go to you with a question similar to one I asked Ron about trends. You mentioned that you’ve noticed a trend in the amount being financed as well. Why don’t you talk a little bit more about that?

Financing attracts more jobs, and increases the size of those remodeling jobs

Andy: I'm sure you guys are aware of your product costs. Through your manufacturing and everything else, it seems like since COVID, it’s not maybe one or two percent—it’s 10 or 15%. We really see financing and people’s perception of remodeling shifting. Everything is “Where’s it gonna be right now?” You’ve got tariffs, you’ve got uncertainty, you’ve got inflation—where your raises are 2–3%, and the costs around you are 10–15%.

So you’re almost playing catch-up for the last five years. Financing is one of those tools to put the customer at ease—to take advantage of the opportunity. That’s why we have options that have no interest for people that have the money but don’t want to use it, but also interest options for people that need a nice payment.

Right—a payment factor that’s not gonna be at 25%, more like under 10% or under 5%.

And just so I’m clear—from the beginning, with our Home Projects Card, Visa was associated with it, I think, 10 years ago. This is strictly just a home project card, like a private label. It has your name—your business name—on it, so the customer can come back and use it for repeat business or any home project jobs.

Industry insights: Flat is better than down

Jay: And in preparation for this panel, I asked each of you to rate how you thought the industry was doing right now—either positive, neutral, or negative—and all three of you pretty much said neutral. Not positive, not negative. Why did you rate it that way? What do you see happening, and what do you think needs to happen to move into the positive category?

Ron: I tend to be optimistic. I think it is positive, but there are obvious challenges. I think the positive aspect is, with the way interest rates and everything are now—mortgage rates specifically—once those move, and we don’t know when that’s gonna happen, I think there’s a ton of pent-up demand out there.

Once mortgage rates move lower and people are more inclined to sell, what does that spur? That spurs home improvement. People have to redo a kitchen, bathroom, roofing, siding—all those different projects. That really gets things moving. So that’s why I’m positive—very bullish still on the home improvement industry—because there’s a lot of pent-up demand. It’s just a matter of when that’s going to happen.

But in the meantime, every lead counts. So maximize that with your efficiency. If you have somebody ready to buy, offer them a solution that works best for them to get as much done as possible.

Yes, there are challenges—tariffs, prices, all those things—but with the pent-up demand, once interest rates move, I think we’re gonna see the floodgates open.

Andy: Yeah, absolutely. I guess I look at it as neutral is a lot better than worse, as far as a positive goes. Everybody’s world—all their jobs—are built around the economy and where it is today. If inflation’s at 10 or 15% and your raise is 2 or 3%, once the product cost slows down and stops rising so high, that’s gonna be a big piece too.

In the home projects world, you’ve got the mortgage side, but you guys are built mostly for people coming back to do remodels in their home. There’s opportunity there, but there’s just so much doubt where things are at right now—with wages and jobs and a lot of variables.

Market variability makes selling to private equity attractive

Jay: And this question builds off of that one. I asked you what you thought the biggest challenges were, and I think all three of you just touched on it a little bit. But anything else you want to expand on?

Ron: Really, with the partners I work with, it’s the variability—from the small mom-and-pops to the large companies and PE firms. Private equity is out there buying companies left and right. That’s one of the challenges from my side. Working with our partners is interesting, but also too, our partners are trying to decide for succession planning and that sort of thing—how long do they want to stick with their business? Do they want to sell it?

So that variable of private equity coming into the marketplace to buy companies is a challenge for owners deciding, “Hey, what’s my play here? How long do I want to stick around? Do I want to sell? Is that what’s best for me and my company?”

And also, the competition with companies that have sold to private equity—because they have an influx of cash, a different marketing strategy, and that sort of thing. That’s something that comes up a lot.

Jay: What do you think is behind that trend? Are people just aging out of the sector, or what makes that such an issue?

Ron: Yeah, I think especially—we also work in the HVAC space, right? Those owners, a lot of them are aging out and looking at retirement. That goes for home improvement as well. When an owner’s thinking about succession planning and then a private equity firm comes knocking on their door, that raises a lot of questions.

Jay: Probably pretty tempting sometimes.

Ron: Absolutely.

Jay: And Andy, how about you? Any challenges?

Andy: Yeah—challenges. I would say, as far as financing goes for any of us, maybe one of the major challenges is first to start to understand, “Hey, financing’s a tool that’s built to increase my ticket and grow my jobs.” But for me to really want to use that as a tool, I need to build it into my overhead—like everything else: the lights, the truck, the sales guy, right?

If you can learn to build it into your overhead, you can go as aggressive as you want with the financing option you want. The challenge is teaching the businesses to do this, because once they get it, their financing goes from 5% to 20%—it feels like overnight.

But the whole thing with financing, like everything else you guys do today, is building it into your overhead so it’s not one big cost. It’s a small cost built into every job. That’s how you’ll succeed with financing.

Jay: So my last question for each of you—is there anything I haven’t asked that you think is important to mention?

Ron: Yeah, we can elaborate a little bit more on the economy. Being with Synchrony, one of the things I really enjoy is our history and our analytics. We understand consumer sentiment. There are a lot of trends out there that our month-to-month analysis tracks. In April, when the tariffs were announced, we saw a big decline in consumer sentiment. Then in May, it bounced back a little bit.

High income people opt for financing instead of spening cash

But the trend is—even in higher-income households—people are sitting on their money. They want to hold their cash because they’re uncertain about the economy. So that’s why, as Andy and I have been saying, financing’s extra crucial right now. They want to use somebody else’s money to make those projects happen.

Andy: Yeah, I’ll absolutely piggyback off that. We’re probably seeing this year financing being used more than any other year. A big part, obviously, is people are starting to understand how financing works. As a consumer, instead of worrying about, “Hey, this HVAC unit, or that I have to have this $15 grand—that’s out—what do I do?” Panic mode. Now they understand that there’s financing.

By having that tool, if you don’t have it, you may be losing sales you’re not even aware of. Your next-door neighbor over there is offering financing, and maybe he’s 3–5% higher, but because he has financing, you may be losing jobs to that.

But you won’t be losing jobs if you’re listening to the Pro Remodeler Podcast. I'm Jay Schneider, encouraging you to hit the like button, leave us a review, and share this episode with your friends and colleagues.

The Pro Remodeler Podcast is a production of Endeavor Business Media, a division of Endeavor B2B.