Quality Lending In Any Environment

Six tips to generate a strong auto portfolio regardless of economic climate.


Wayne Vann, CEO of Texas-based Navy Army Federal Credit Union ($1.13B, Corpus Christi, TX), uses a multi-pronged approach to foster a solid auto lending business. Here are a few best practices direct from the man himself.

  • Educate and support your Board. “You have to have full disclosure with your Board. We give our Board a complete review of all of our lending.”
  • Build an experienced management team. “We understand the auto business and talk [to the management team] all the time about how to put these deals together.”
  • Determine your risk tolerance. “If you don’t have the guts for repossession, then don’t get in the business. Anybody can make "A" paper loans. When you get down to "C" and "D," you’re going to have to go to work.”
  • Determine what lending system and processes work best for your credit union. “We do not have any automatic decision here. We do not have centralized approval. We have 10 branches and 40 lenders. All these lenders have some autonomy and some authority.”
  • Build relationships. “We talk to our staff about how to really develop an application with weaker credits. We have a 67% Hispanic membership. That’s a cohesive group. If we get into the family and do a good job for one person, then they throw the net out for us.”
  • Be ready to collect. “Hire talent, and incent performance. I probably have the highest paid collection crew in south Texas. They are incented on overall team performance. In good times, we repossess approximately 1% of our portfolio.”

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