LAS VEGAS — Credit Union Journal asked CU lending executives to talk about the "new normal" in auto lending, offering insight into the differences to be found in the market today compared to just a few years ago.
Vanessa Stusek, retail services manager, Lake State CU, Moose Lake, Minn.
More and more of our members are using the mobile application — either for shopping or even for getting approved for a loan. We have only had the mobile app for six months, but people are embracing it.
Another issue is availability after normal hours. In Minnesota there are no car sales on Sunday, so we don't have to worry about staffing on Sundays, but in the late evenings dealers want us to be available.
Keith Troup, VP of lending and chief lending officer, WSECU, Olympia, Wash.
What is different is we get answers to dealers in minutes, rather than hours, and we get loans funded in hours, rather than days.
We look at dealers as partners, rather than an impediment. This new outlook started up at the board level. There is a greater understanding throughout the whole credit union as to how important the indirect channel is. We made changes at the branch level so the people there no longer see indirect as a competitor. We look for dealers that share our values and also want to give back to the community.
Alissa Johnson, VP of consumer lending, Fibre FCU, Longview, Wash.
We are competing more with other credit unions. The dealers want lenders to match rates, so we end up competing with credit unions.
Used car values are high right now, so we are having to look at the loan-to-value ratio to make the loan go through. We don't do risk-based lending; we just have one rate for everybody. We will do that for as long as we possibly can.
Sarah Horten, VP of lending, First Financial CU, Albuquerque, N.M.
The biggest difference is on so many loans there is a lack of any down payment, and therefore a higher loan-to-value ratio. I spent 20 years in banking, and no one at a bank could finance a car without the buyer putting 15% to 20% down.
Esther Mata-Rearick, VP of lending, New Mexico Educators Federal Credit Union, Albuquerque
Our relationships allow us to increase rates and/or lower the dealer flats, but continue to get their business. We offer such good service, and we are consistent, so dealers have learned they can depend on us.
We had been using CRIF, but we took indirect in house at the end of 2012. We saw an immediate improvement, and we still are doing really well.
