Third-party consumer financing is how high-ticket trades sell $18,000 systems to homeowners who do not have $18,000. It is also the single most mishandled money flow in a ServiceTitan file. The lender funds you net of a dealer fee, on its own schedule, in its own lump, and almost nobody books the fee. Your bank never reconciles and your gross margin on financed jobs is overstated by every dollar of it.
A homeowner signs for an $18,000 heat pump on a 0 percent promotional plan through GreenSky, Synchrony, or Wisetack. Your technician closes the sale on the spot, the customer walks away owing you nothing, and ServiceTitan records an $18,000 invoice paid in full with a financing payment type. Everyone is happy. The books are already wrong.
The lender is not going to send you $18,000. The lender is going to send you $18,000 minus a dealer fee, and on a long promotional term that fee can be a substantial percentage of the ticket. It will not arrive today, it will arrive on the lender's funding cycle. It will not arrive alone, it will arrive bundled with other approved deals, sometimes net of a holdback or a clawback on a cancelled job. Not one of those facts is visible anywhere in the ServiceTitan export.
So two separate problems start on the same day. The reconciliation problem: a deposit hits the bank that matches nothing in QuickBooks. And the margin problem: the cost of buying that customer a cheap monthly payment never lands on the P&L, so every financed job looks more profitable than it was. The first one is annoying. The second one is dangerous, because it is the number you use to decide what to sell.
Financing is not a card payment with a different logo on it. It behaves like a receivable from a lender, and treating it like a swipe is what breaks everything downstream. Here is exactly what goes wrong.
This is the mistake that guarantees the batch will never match the bank. If a ServiceTitan batch contains card payments, cash, checks, and financing payments together, that batch is asking one deposit to explain four different funding sources that arrive on four different days from four different places. The card processor funds in two days, the lender funds on its own cycle, the check sits in a drawer. The batch total will never equal any deposit that ever hits your account. Financing payment types must be batched separately, exported separately, and cleared through their own account. That is not a preference, it is the only arrangement in which the arithmetic can work.
The dealer fee, sometimes called a merchant fee or a dealer discount, is what the lender charges you for carrying the loan and subsidizing the customer's promotional rate. It is deducted before funding, so no invoice ever arrives and no vendor ever bills you. Because nothing in the workflow forces you to record it, most shops simply do not, and the difference either sits in a clearing balance forever or gets plugged into an adjustment nobody reviews. That fee is a genuine cost of making the sale, and it can dwarf the two or three percent you pay on a card.
Lenders fund on their schedule, not yours, and often bundle several approved jobs into a single transfer. A cancelled or reduced job can be clawed back out of a later payout. So the deposit that lands on Thursday might be three jobs from last week, net of fees, minus a partial reversal on a job that changed scope. Working backward from that number without the lender's funding report is not bookkeeping, it is archaeology. This is the same untangling problem described on why your ServiceTitan deposits do not match the bank, but with worse timing and a bigger fee.
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An $18,000 system sold on a promotional financing plan with a 7 percent dealer fee. Nothing about the job changes. Only whether your books tell you the truth about it.
| On an $18,000 financed system | What your P&L shows today | What it should show |
|---|---|---|
| Revenue recorded | $18,000 | $18,000 |
| Cash actually received from the lender | $16,740 | $16,740 |
| Dealer fee at 7 percent | Never booked, or lost in a clearing account | $1,260, booked as a cost of the sale |
| Equipment, labor, and permit cost | $11,000 | $11,000 |
| Gross profit | $7,000 | $5,740 |
| Gross margin | 38.9 percent, overstated | 31.9 percent, true |
| What you conclude from it | Push financing, the margins are great | Price the fee into the job, or steer the customer |
Owners tend to think of the dealer fee as a financing expense, the same bucket as bank charges or interest. It is not. You did not borrow anything. You paid a lender to make the customer's monthly payment attractive enough to close the sale. That is a selling cost tied to one specific job, and it should be visible on that job.
The practical consequence of getting this wrong shows up in every decision you make with a report. If the fee sits in overhead, then a financed job and a cash job look identically profitable in job costing, and your best salespeople will keep steering customers toward the plan with the longest promotional term, which is usually the plan with the highest dealer fee. You will be rewarding the option that costs you the most and calling it your best-performing option. That distortion runs straight into ServiceTitan job costing and out the other side into technician bonuses.
Book the dealer fee as a cost of sale, on its own account, so it reduces gross profit rather than hiding under the operating expense line. Some shops prefer a contra-revenue treatment, recording the sale at the net amount the lender funds. That is defensible under a narrow reading, but it understates revenue, makes financed and cash jobs incomparable on the invoice, and makes your ServiceTitan revenue reports impossible to tie to the P&L. We recommend gross revenue with the fee as a separate cost of sale. It keeps ServiceTitan and QuickBooks speaking the same language, which is the whole point of the ServiceTitan and QuickBooks integration.
Booking the fee to the individual job is straightforward when the lender funds one job at a time. It gets harder when the payout is a bundle, because the fee arrives as one number for several jobs. The realistic answer for most shops is to allocate the fee from the lender's funding report back to the jobs in that payout, monthly, rather than trying to force ServiceTitan to do it at the invoice. It is a reconciliation task, not a software feature, and anyone who tells you the integration will handle it by itself has not done it.
Six changes. None of them touch how your technicians sell. All of them live in the ServiceTitan payment type setup, the QuickBooks chart of accounts, and one monthly habit.
Not one generic Financing payment type. GreenSky, Synchrony, Wisetack, and any in-house or promotional program each get their own payment type in ServiceTitan. Different lenders fund on different cycles with different fees, and the moment two of them share a payment type you have lost the ability to reconcile either one.
Create a bank-type clearing account in QuickBooks per lender, for example GreenSky Clearing. Map that lender's payment type to it. The balance in that account is, by definition, the money the lender owes you for approved jobs it has not funded yet. That single number is now something you can look at and argue with.
Financing payment types get their own batch in ServiceTitan, always. A mixed batch is asking one deposit to explain several funding sources, and it will never match. This is the single most common cause of financing reconciliation failure, and it is also the easiest one to fix.
Create a cost of sale account for financing dealer fees, separate from your merchant card fees. Keep them apart. Card processing runs a few percent and financing dealer fees can run several times that, and averaging them into one line hides which one is eating your margin.
Every month, pull the lender's funding or settlement report. It tells you which jobs were in each payout, what fee was taken, and what was clawed back. Record each payout as a transfer out of the lender clearing account into the bank, with the fee as a cost of sale line and any reversal as a separate line. The deposit now matches the bank to the penny.
A financing clearing account that keeps growing is telling you something real: jobs marked as paid in ServiceTitan that the lender never actually funded. Incomplete paperwork, a loan that was never drawn, a job that changed scope. That balance is a collections list, and most shops do not know it exists. Finding it is often the first cash win of a ServiceTitan QuickBooks cleanup.
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Programs and terms vary by dealer agreement, so treat this as the shape of the problem rather than a quote of your specific contract. Your dealer agreement and your funding report are the authority.
The longer the deferred-interest or reduced-rate window you offer the homeowner, the more the lender charges you for it. A short term costs little. A long 0 percent promotional plan is the most expensive product on the menu, and it is usually the one that closes the sale. That trade is worth making with your eyes open, not by accident.
Lenders deduct the dealer fee before they fund and often combine several approved deals into one transfer. The number that lands in your bank corresponds to no invoice in ServiceTitan. Only the funding report explains it, which is why the funding report belongs in your month-end close.
Funding can lag the job by days, and paperwork problems can lag it much longer. Revenue is recognized when the work is done, so a financed job routinely sits as a real receivable from the lender across a period end. That is exactly what the clearing account is for.
If a job is cancelled, reduced, or the loan is unwound, the lender does not send you an invoice. It takes the money out of the next payout. If nobody reconciles the funding report, that reversal silently makes a future deposit look wrong and gets written off as a mystery.
These are the symptoms we see in almost every ServiceTitan file that sells financing and has never set it up properly.
Send us a month of lender funding reports and your ServiceTitan payment type setup. In the free Audit we will show you the dealer fees that never made it onto your P&L, the true gross margin on your financed jobs, and any funded-but-never-received deals sitting in a clearing balance. No cost and no obligation.
Nothing about how you sell has to change. Start at the ServiceTitan resource hub, or let us run it every month for you with ServiceTitan bookkeeping services so the funding reports get reconciled without anyone in your office having to learn how.
Get a Free Financing AuditBecause the lender does not send you what you invoiced, and it does not send it when you invoiced it. The payout is net of a dealer fee, it arrives on the lender's funding cycle rather than yours, and it usually bundles several approved jobs into one transfer, sometimes with a clawback on a cancelled job netted out of it. If financing payments are also batched together with card and cash payments in ServiceTitan, the batch is being asked to match several different funding sources at once, and it never will.
Yes, always, and it is not optional if you want the account to reconcile. Financing payment types should be batched separately from card, cash, and check, exported separately, and cleared through a lender-specific clearing account. A batch that mixes payment types is expecting one bank deposit to explain money arriving from four different places on four different schedules.
A dealer fee, also called a dealer discount or merchant fee, is what the consumer lender charges you for financing the customer and subsidizing their promotional rate. It is deducted before the lender funds you, so no bill ever arrives. It should be recorded as a cost of sale on its own account, separate from card processing fees, so it reduces gross profit on the jobs that generated it. It is a selling cost, not a bank charge.
Yes, and it is overstated by the entire fee. On an $18,000 system with $11,000 of job cost and a 7 percent dealer fee, the fee is $1,260. Book it and your gross profit is $5,740, or about 31.9 percent. Skip it and your P&L reports $7,000, or 38.9 percent. Every financed job in your file is carrying that same overstatement, which means your average margin, your pricing, and any commission calculated off margin are all built on a number that is too high.
Record it gross, at the full invoice amount, and book the dealer fee as a separate cost of sale. Recording net understates revenue, makes financed jobs and cash jobs impossible to compare, and breaks the tie between your ServiceTitan revenue reports and your QuickBooks P&L, which is the connection you need most at month end.
The lender funding or settlement report tells you. It lists the deals in each payout, the fee taken on each, and any reversals. That report, not the bank statement, is the source document for financing reconciliation. If your close does not include pulling it, you are guessing, and the guess is what produces the plug entry at the bottom of your reconciliation.
It usually means real money. Jobs marked as paid in ServiceTitan that the lender never actually funded, because paperwork was incomplete, the loan was never drawn, or the scope changed after approval. Because the invoice shows paid, nobody chases it. Cleaning up that balance is frequently the first cash a cleanup engagement recovers, and it is invisible until financing has its own clearing account to make it visible.
It does if you pay on gross profit or margin, which many shops do. If the fee was never booked, the margin used to calculate the bonus is too high and the technician is being paid on profit the company never earned. That interacts with the pay rules covered on our ServiceTitan technician commissions page, and it is worth checking before you change a comp plan.
Yes. We set up lender-specific payment types and clearing accounts, separate the financing batches, add a dealer fee cost of sale account, and then reconcile each lender payout against its funding report every month as part of the close. Your sales process does not change. The books simply start telling the truth about what financing costs you.
Real results from contractors we have helped untangle their books and systems.
They didn’t just record transactions and call it a day. They built a custom chart of accounts around how a remodeling company actually runs, did a full catch-up on years of bookkeeping inside QuickBooks Online, and now stay on top of my monthly bookkeeping and payroll. Every step, they broke it down in simple terms instead of burying me in accountant talk.
FinTruction rebuilt the whole thing from the ground up, with real job costing, work in progress, and retainage. They didn’t just hand me reports and disappear; they walked me through my numbers until I understood them.
Sahil and his team handle the bookkeeping and job costing for my painting business. They cleaned up my books and set up integrations that give me accurate, timely job costing with solid weekly data. Reliable, detailed, and genuinely invested in getting the numbers right.
FinTruction is the only bookkeeping team we’ve found that truly understands construction accounting and WIP reporting. They aligned our income and costs across 21 jobs and gave us full, monthly transparency. Fast, accurate, and an indispensable partner.
When I came to FinTruction I had no financial structure. No job costing, no WIP tracking, books behind. They did a full cleanup and rebuilt job costing and WIP tracking in QuickBooks. Now I know what’s billed, what’s owed, and where every job stands.
A couple of minutes from a contractor we support, sharing what working with FinTruction has been like and what changed once their numbers finally made sense.
We will book the dealer fees, separate the batches, reconcile the lender payouts, and show you the real margin on every financed job. Start with a free Books Audit.
Tell us what is broken between ServiceTitan and your books. We will look at your actual data and show you exactly where the numbers diverge, at no cost.
