Credit Unions Remind Members of Their Biggest Advantage – a Credit
Dateline NBC, CBS Evening News, USA Today – national media is a-buzz about
automobile dealers, telling consumers cautionary tales of exorbitant finance
commissions and fraudulent contracts.
The rush of coverage is enough to worry even the most ardent automobile shopper
– more and more of whom are turning to reliable sources for support and education
about the car buying process, including credit unions.
Responding to this need, credit unions are dedicating resources – money and
time – toward services that assist members in preparing to purchase a vehicle.
According to a recent Callahan’s survey, 74 percent of credit union members
go online to research vehicles before buying. Credit union Web sites are part
of this research. Many are providing online support in the form of loan calculators
or tips pages.
Another popular credit union service is car buying seminars. Led by industry
experts and held at credit union branches, these educational and interactive
classes tackle the typical consumer questions:
- What automobile will fit my needs?
- How does my credit rating affect the purchase?
- How much should I spend on an automobile?
- What does it take to negotiate a good deal?
- Should I trade in my current vehicle or sell it myself?
While providing these services to members is a wise credit union practice,
it is not an inexpensive endeavor. Credit unions pay handsomely for industry
experts’ advice and time. Experts will often charge a speakers fee, which could
be upward of $5,000 a day. In addition, there are the costs of maintaining and
updating online content as well as possible fees associated with acquiring the
rights for any borrowed material.
Credit unions seeking an economical alternative should look to their current
business and community relationships for options. For example, credit unions
partnering with Enterprise Car Sales, a division of Enterprise Rent-A-Car, tap
Enterprise’s account executives to lead car-buying seminars – at no cost. In
addition, Enterprise supplements credit unions’ online car buying content by
providing a direct link to the Enterprise Car Sale Web site
www.enterprise.com/carsales. This access allows members to stay on their
credit union Web site to search for the perfect car and arrange approval of
However, even with education and research under their belts, members still
may be apprehensive about stepping into the dealership showroom. Credit unions
must let their members know that they have an advantage when they walk on the
lot – a credit union membership.
Much of the recent media coverage involving the automobile industry involves
actions not in the showroom but in the finance and insurance (F&I) department’s
office. Research shows that credit unions are losing potential car loans to
these dealership-brokered deals – 70 percent of credit union members who buy
a vehicle from an independent or franchised dealer also finance the vehicle
through the dealer. Credit unions need to remind members to visit them for an
Many credit unions partner with Enterprise Car Sales in order to steer car-buying
members back to the credit union for financing. Enterprise Car Sales guarantees
that credit unions receive 100 percent of used car loans 100 percent of the
time from member purchases. In addition, members are treated to a respectful
car buying experience as part of the Enterprise car buying process. Enterprise
offers consumers more than 120 makes and models of quality late-model ASE-certified
used vehicles that are priced below NADA or Kelly Blue Book values, and include
a 12-month/12,000-mile limited power train warranty and seven-day/1,000-mile
Making an automobile purchase even in the best of times can be an intimidating
process. With the current media hype, car buyers are more apprehensive than
ever to buy a car. Make sure you are doing all you can for your members to take
away the fear … and take in the loans.