Indirect Loans Vital To Many CU Portfolios.
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For credit unions that don’t offer indirect lending for new vehicles, Murray Halperin has this message: “Good luck in the new car business.” With 40% of auto dealers already in some type of relationship with providers of alternative financing products, CUs need to get connected in order to compete, he said, acknowledging he has a bias in the matter. Halperin is vice president-sales and marketing for Payment Advantage in Sarasota, Fla., which have been offering indirect lending services to several hundred credit unions since 1992. “We offer a balloon note type product as a turnkey approach,” he said. “All the lender has to do is offer the loan.” Whichever loan product or relationship credit unions enter into, Halperin was one of several experts who told The Credit Union Journal the most important thing is that credit unions get over being gun shy about indirect lending. Halperin noted, for instance, that technology has allowed the financing arms of the major manufacturers, including GM, Daimler/Chrysler and Ford, to provide dealers with instant online approval for car shoppers. Credit unions looking to remain competitive have little choice, he suggested, and whether they choose to outsource to businesses such as Payment Advantage or manage the service in- house, many in the industry agree that it’s a good way to tap into a market that they otherwise couldn’ touch. Getting The Business “More than half of the auto business that we get comes through the dealerships,” said Richard Warren, VP-lending at Commonwealth Credit Union, Frankfort, Ky. “If you don’t have that relationship, you’re… |