SAN ANTONIO-As the auto lending market continues to get tougher, credit unions have to find more ways to stand out beyond simply offering a low rate.
That's the advice of Cory Jefferies, VP of business development for SWBC. "The captives, the banks, and the finance companies are all back and they are back with a vengeance. The competition is just going to get tougher this year. Dropping rate and advertising that won't work for credit unions in 2012."
Jeffries is advising credit unions to tie ancillary services and products to a car loan and market that package. "Offer something that will make the car loan more compelling, something that will differentiate the credit union. We are introducing a program that offers complementary products with the car loan, such as vehicle protection and loan protection. That package is getting a lot of positive interest from credit unions. We also offer a very competitive program that allows the member to finance and insure their vehicle at the credit union."
Besides ancillary products, the credit union should also focus on making the car-buying process more convenient and promote that advantage as well, Jefferies said. "Tie in car-buying services, online car shopping, and remote closing, where the member does not have to come back into the branch to finalize the loan."
Beyond a new advertising approach this year, credit unions should consider extending credit to more borrowers, Jefferies said. "The banks and finance companies are buying deeper paper. That is something credit unions will have to wrestle with-will they relax their underwriting guidelines?"
