People consider buying a vehicle and borrowing money to do so as one event. That’s the main message emerging from a study conducted earlier this year by CU Direct.
Six credit unions from five markets participated in the study, which involved focus groups comprised of members and nonmembers. Partici- pants were asked about their most recent vehicle-buying experience.
“Credit unions must recognize that if buying and financing a car is one event from the buyer’s perspective, then you need to be involved in the buying process in order to influence the loan decision,” says Tony Boutelle, president/CEO of CU Direct.
That means providing information that will help consumers as they shop for vehicles, as well as making it easy to get a loan on the spot.
Preapprovals are the key, for both the buyer’s and dealer’s convenience, Boutelle emphasizes. If a loan is already approved, that’s where the dealer will send the loan, if the dealer has a good working relationship with that lender. He says 80% of members who get preapprovals will obtain credit union financing.
His advice to lenders for 2014 is twofold: Engage members during the buying process and recognize that the dealer is your customer, too.
“Give buyers the tools to get pre- approved and to help them find and research cars,” Boutelle says. “Then be sure dealers know you’re working with them, not against them, by being consistent in how you handle preapproved members’ transactions.”