Originally published on CUInsight.com

Keep me honest. I’ve been known to ask for help in finding my sunglasses…while I’m wearing them. Hey, they’re lightweight and comfortable! So if I’m overlooking an important point, please guide me in the right direction. In this situation, I have a nagging feeling the industry is doing just that.

We’re talking auto loans. Or rather, auto loan funding.

If my data sources are correct, credit unions handle 16.7% of auto loans in America(1). Not too shabby. In fact, that’s a lot of loans, a whole bunch of cars, and millions of people receiving rates likely better than from a for-profit bank. Congratulations financial co-ops!

Hold off on swinging the “We’re #1” foam finger for just another minute. A previous post celebrated an announcement from CUNA of credit union penetration. 1 in 3 Americans. 100 million members. So why only 16.7% of auto loans?

Some digging ensued and it didn’t take long for the digital shovel to strike a proverbial wooden box. Upon opening it, I learned there was a leak in the ship.

Credit unions do, in fact, accept auto loan applications for 33% of Americans. However, only around half ever get funded. That’s 50% or 1 in 2 members.

What’s half of 33%? Not too far from 16.7%. Wait a minute, I’ve heard that number before! Isn’t that the total percentage of auto loans credit unions hold in the market? Weird, right?

Could it be that credit unions are receiving all the applications they need, yet, for various reasons, are losing out to other lenders? Sure, you have high underwriting standards, and not everyone qualifies; you don’t need to rationalize to that end. However, there is still a loss. You’re putting effort into underwriting these loan applications; be bothered by losing half of them!

From reducing flipped loans with the convenience of share drafts to the personal touch of a member representative calling on every loan approval, there are credit unions making strides to confront this issue. What are your numbers, and could reducing a portion of the lost half make a difference in your 2015 goals?

Disclosure: My company works with credit unions to help increase booked loan percentages as well as their total auto loan volume. It is in our, and the industry’s, best interest to identify sources of lost income and maximize growth for institutions and their members.

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(1) Experian, Q3Y14