Credit union loan zone: Fee strategy fuels indirect

first_imgLike executives at many credit unions, the team at Ent likes to recognize milestones. A key record at the $4.3 billion Colorado Springs credit union serving 240,000 members has been the number of consecutive business days funding more than $1 million in indirect car loans. Up to the spring of 2014, the longest streak was nine days.In July 2014, the credit union launched an effort to win business from big direct lenders in its market area. “These lenders were offering 1.99 percent for 60 months. Our rate was close to a percent higher than that,” recounts CUES member Bill Vogeney, senior EVP/lending and finance. “We saw the opportunity to match some of those rates, when needed, but we couldn’t charge 1.99 percent and pay the normal dealer fee.”Fortunately, some of Ent’s higher-volume dealers were willing to accept a lower flat rate in exchange for being able to match the competition. “The dealers don’t like it either when customers come in and say, ‘I’m going to go through USAA or Navy Fed for my car loan,’” Vogeney says. “We’re in a big military town, so those types of national lenders do big business here.”And so Ent began another series of consecutive days booking more than $1 million in car loans when it introduced its low rate/low dealer fee combo—a streak that was still going strong 17 months later in mid-December 2015 even though the rate had inched up to 2.25 percent. continue reading » 5SHARESShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblrlast_img read more