CU Direct, a provider of lending solutions to the credit union industry, has partnered with First Associates Loan Servicing to offer a solution that includes services from billing to collections.
“Our goal is to provide leading products and services that help credit unions grow their auto lending portfolios,” said Brent Hollingsworth, national director of strategic alliances at CU Direct, in a statement.
The solution with San Diego-based First Associates can be used to services auto loans — CU Direct’s core product — as well as other personal lending classes such as student loans.
First Associates is a provider of portfolio backup solutions for credit unions and other lenders. Ontario, Calif.-based CU Direct was founded in 1994 and represents more than 1,000 credit unions, which it helps generate loans and manage risk. It’s helped the credit union industry fund more than $120 billion of loans.
The recent survey conducted by CUNA (largest trade organization for Credit Unions’s) indicated that because of service issues with the auctions 56% of CU’s surveyed despite the fact that auctions are 12 – 18 % higher in returns, use other channels, retail, wholesaler or even repossessor none of which drive competitive bidding due to the number of those bidding. Most auctions are built to serve large remarketing organizations. FI’s unless a large indirect lender have a difficult time getting attention for a small number of units they would liquidate. Most large regional auctions have in our experience have hundreds and sometime up to two thousand bidders that fly in, drive in and simulcast (internet). For the bidders its all about where the inventory is. From our experience as a large remarketer the best place to liquidate and a cost effective way to liquidate inventory including prudent transportation costs and a detail are the large regional auctions. We are not fans of reconditioning other than a detail, dealers can do cosmetic/mechanical more cost effectively, its difficult to recoup that investment for FI’s. An FI can market via a online liquidation service but its still about the numbers of bidders, confidence in the product being bought and eyeballs on the units, our experience is that large regional dealer auctions are still the place to do that.