Bank Statement Analysis for Used Car Dealerships
Used car dealers run floor-plan financing, BHPH note payments, and large unit deposits. Learn how lenders analyze dealership bank statements for inventory and working capital.
Car Dealerships Have the Largest Pass-Through of Any Retailer
An independent used-car dealership produces one of the hardest bank statements to underwrite. Single transactions are huge, floor-plan financing moves large sums in and out, and buy-here-pay-here (BHPH) lots collect hundreds of small note payments. Gross deposits tell you almost nothing without context.
How Dealership Money Moves
- Vehicle sale deposits: Large lump sums per unit, plus lender funding ACH when the buyer finances.
- Floor-plan draws and curtailments: Inventory financing (NextGear, Westlake Flooring) flows in to buy cars and out as units sell — pure pass-through.
- BHPH note collections: Many small recurring payments from in-house financed buyers — a recurring-revenue stream.
- Auction and reconditioning outflows: Payments to auctions (Manheim, ADESA) and repair vendors.
Floor Plan Is Not Revenue
The biggest mistake is counting floor-plan draws as income. They are borrowed inventory dollars that must be repaid when the car sells. True revenue is the gross margin on unit sales plus BHPH interest. Underwriters must net out floor-plan activity to find the real operating cash.
What Lenders Focus On
- Unit-sale margin after floor-plan curtailments
- BHPH note collections as recurring revenue (for pay-here lots)
- Auction/reconditioning outflows vs. sale proceeds
- NSF and floor-plan delinquency signals
Bottom Line
Dealerships are fundable when floor-plan pass-through is separated from true margin and BHPH collections are recognized. StatementScrub classifies floor-plan and lender-funding flows so the real cash position is visible.
Related reading: Auto loan analysis | Auto repair shop analysis | What lenders look for
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