Citizens One Auto Finance has been revving up used-vehicle loan originations since launching its CPO program “a little over a year ago,” President Craig Lamp told Auto Finance News.
Volume for the bank’s CPO program has “more than doubled,” Lamp said, adding that the program has exceeded company expectations. To that end, “a big chunk of” the bank’s portfolio is focused on the used side, fetching a little more than 50% of total share. “Part of that is the CPO program,” he added.
As the used-car market continues to balloon, big banks are increasingly tapping that market opportunity. Data from Experian’s second-quarter State of the Automotive Financing Marketing report showed banks grabbed a larger share of used-vehicle financing, snatching 2.7% more used-car volume year over year.
“There’s some good traction in the marketplace,” Lamp said. “More CPO vehicles are being sold each year, from our understanding, so we felt the need to attach something to that.”
Separately, Citizens launched a new dealer bookout sheet in March to alleviate dealer friction points, Lamp said. The valuation guide gives dealers flexibility in assigning vehicle values. Citizens will “do some internal configurations” based on its internal validation source to try to match the dealers’ values better, he explained.
“We can alleviate the friction point if we see the car as X and they see the car value as Y and you end up with potential conflicts as you’re trying to book deals,” he said. “It’s not entirely new to the industry, but it’s different for us.”
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