ONTARIO, Calif.-Driving the bottom line in 2010 may come down to the credit union's ability to stay in the auto lending game.
That won't be easy, acknowledged Credit Union Direct Lending (CUDL) spokesperson Bill Meyer, with banks jumping back in with sub-3% financing and manufacturers offering 0%. "We see this competitive marketplace continuing," Meyer said.
According to Meyer, to fight for share, credit unions must focus on three things: excellent portfolio management to avoid risk, staying close with members during the entire car-shopping process, and educating members about 0% financing.
With all the deals available, the most important step, stressed Meyer, is staying right beside members throughout shopping process. He emphasized online car-buying sites, such as CUDL's AutoSMART, can keep members at the CU from start to finish. "AutoSMART is customizable and credit unions put their own look and brand to it. Now they can offer members a true online shopping resource."
Before members can head off to the dealer, Meyer said credit unions should also educate them about 0% deals. "Make sure you tell them about some of the drawbacks, like 0% is generally for A-plus credit, they may not be eligible for other discounts, and the monthly payment could be higher than what they will get from the credit union. Let them know that 0% may look great up front, but it does not always work out best for every member."
