An auto refinance program is an essential component of a profitable auto loan portfolio. Refinanced auto loans complement a credit union’s direct and indirect programs by providing lenders with seasoned auto loans that result in lower delinquency rates and fewer charge-offs, allowing credit unions to achieve an attractive yield. In order to maintain an efficient auto refinance program, credit unions must develop a strong team to manage the process from start to finish.
Building The Team
Building an internal auto refinance program requires a streamlined system that brings in new borrowers through effective lead generation practices and works to close loans at a profitable rate.
Starting and maintaining a successful program also requires an underwriter at least six days per week. And accepting applications online requires an underwriter who can work outside of normal business hours in order to manage the higher volume of applications the credit union will receive.
A team of qualified loan officers who can maintain a high closing rate regardless of application volume is a must-have for any auto refinance department. It’s important that credit unions instill a strong sales culture within this department in order to see positive results. To be successful, loan officers must continuously follow up with applicants, effectively communicate the terms of the loan, and field all inquiries that the applicant may have. A loan officer serves as the applicants’ support system while helping them navigate the refinance process.
The credit union auto refinance team would be incomplete without an efficient fulfillment department that works to verify that loan packages are signed and completed, all guidelines and stipulations are met, and resolves any issues that arise. This department stays on top of the status of each loan so that the program can continue to run smoothly.
Perfecting title work is a labor-intensive process and is essential to ensuring the credit union’s investment is protected. The team must be well-versed in the requirements for title transfer and must stay on top of changes, as well. If the credit union operates in multiple states, the team also must be able to manage the title process from state to state. Each state has its own regulations, so the credit union team must be knowledgeable of these requirements.
Marketing the program to new and potential members is an expensive and time-consuming process, but it is a necessary step. Finding the right borrowers allows credit unions to build a profitable auto loan program — a skilled marketing team knows whom to target, what to say, and how to deliver the message.
Due to the time and costs associated with developing and maintaining a consistent auto refinance program, credit unions should consider outsourcing their programs to an experienced party that is dedicated to refinancing auto loans.
Outsourcing May Be Your Best Option
Credit unions can outsource their auto refinance program to a qualified broker — such as rateGenius — who can manage the entire refinance process from lead generation to funding. Outsourcing allows lenders to reach more borrowers, save time, and decrease overhead while maintaining control of underwriting and funding.
Potential borrowers are able to apply to refinance online or over the phone. RateGenius provides customer support, underwriting, fulfillment, title work, and marketing services for its lenders — all of the necessary components for a successful program. The program results in higher conversion rates, is designed to efficiently respond to high application volume, and provides more opportunities to cross-sell.
It’s no secret that an auto refinance program is an essential part of an auto loan portfolio, but establishing a profitable program requires time and constant vigilance that is difficult to provide internally. By outsourcing their auto refinance program, credit unions will feel confident knowing that the entire auto refinance program runs smoothly.
Learn more about how rateGenius can help build any credit union’s auto refinance portfolio by calling 866-413-5976 or visiting http://www.rategenius.com/.
RateGenius is a nationwide web-based vehicle refinance loan broker. With more than 200 competitive lenders, rateGenius can find customers the most competitive vehicle interest rate to refinance their loans on cars, trucks, SUVs, and specialty vehicles, such as boats, RVs, and motorcycles.
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