Navy Federal Expects Growth in 2014

Navy Federal Credit Union has seen a record year in its auto loan originations and expects 2014 to be just as big ― if not bigger.

“We’re seeing around a 17% increase in auto loan originations so far this year compared to the same period in 2012,” said Joe Pendergast, the credit union’s AVP of consumer lending.

Pendergast attributes a good bit of that increased business to an improved economy, a continued low interest rate environment, and overall auto sales figures that are spiking to pre-recession levels. He expects that as the average age of cars in the U.S. increases, like many Americans, more of the credit union’s members will be looking to trade in old cars and buy new ones.

While the improving economy could lead to higher interest rates, the credit union will strive to remain competitive, Pendergast said. For now, Navy Federal offers loans with terms as long as 84 months, though that term is not the credit union’s most active bucket, he added.

Pendergast, who has worked for banks in the past, points to a strong and loyal culture of service at Navy as a more primary source of its continued growth. The institution was founded in 1933 for military members as well as Department of Defense members and retirees. Current membership stands at around 4 million.

Servicemembers in the nation’s military are “very important” to the staff at the credit union, a dynamic that motivates the CU’s mission to make certain that any approved loan is “affordable” to the member, Pendergast said.

“They look out for us, we look out for them,” he added.

But it’s not just the loyalty factor that has grown business. The credit union has “rock-bottom” rates. And, the institution puts emphasis on a speed to market origination capability. Pendergast said that as soon as someone submits a loan application, loan officers give the applicant an answer as quickly as possible. On average, staff members touch a loan within minutes of submission.

“We aren’t giving the dealers or competitors a chance to steal these loans away from us,” he said.