DES MOINES, Iowa -- Wells Fargo Financial Acceptance, a leader in non-prime auto finance, has launched Spectrum Pricing, a new risk-based pricing model for use by WFFA's 10,700 franchised auto dealers in the U.S.

With Spectrum Pricing, WFFA can remain a leader in high advance deals while also offering more competitive rates on both low advance deals and higher FICO deals, the company said.

During a four-month pilot, the new pricing program increased approval ratios by 10% and booking ratios by approximately 18%. At the same time, an estimated 60% of WFFA's customers qualified for lower pricing compared to the previous scoring model.

"By analyzing our past experience, we realigned our pricing to assure that we provide our best call to the customers who represent the lowest risk," said John Dangoia, WFFA's senior vice president for risk management and new product development.

Initial ideas for this project came from the dealer community and were endorsed at Acceptance's Dealer Advisory Councils.

Spectrum Pricing benefits include up to 145% advance with lower advance deals qualifying for lower rates (as low as 6.49%).

The automated process of Spectrum Pricing creates greater flexibility, said Ken Gang, manager of credit risk. "This allows the credit analyst to spend more time providing service and building relationships with the dealers. We're hearing from dealers that they feel we are providing more attention to them and we know we have more time to spend negotiating the more complex deals."