While you may not need a vehicle loan today, do you expect that you’ll need to borrow money to buy a vehicle in the near future? Regardless of your credit history, joining a credit union and establishing a relationship now is a smart move that could really help you down the road when you do purchase a vehicle.
This story is a good example of how one of our members came out ahead because of her relationship with Day Air.
One of our consumer loan specialists, Lisa, recently worked with one of our members to obtain a loan to purchase a car. This member has some serious past credit issues, no recent credit, and no current credit score. But, since Day Air is her primary financial institution, we receive the direct deposit of her paycheck. This member has a track record of eight years working at her current job. So, our underwriter approved the request for a loan of up to $15,000, not to exceed 80% LTV (including tax and title), on a 2008 or newer vehicle with under 90,000 miles.
The member went car shopping and selected a preowned 2014 Nissan Altima with less than 47,000 miles with a selling price of $15,424, including tax and title. The dealership submitted the deal through their special financing department. There, our member was approved with a $2,000 down payment and for an interest rate of 20.49% for up to 72 months with a monthly payment of $349 that included GAP coverage*, which cost $799. Our member liked the dealer financing option because of the smaller down payment but she called Lisa back to discuss the loan before finalizing it.
Lisa convinced our member that Day Air could offer her a financing deal that would save her significant money over the lifetime of the loan.
First, Lisa asked our underwriter to lower our down payment requirement from $3,300 to $2,000 in order to match the dealer’s down payment requirement. Then, once our underwriter agreed to this, Lisa had several conversations and email exchanges with the member to convince her that the Day Air financing option at a rate of 8.49% for 60 months was a far better deal. The Day Air deal also included free GAP and the financing of a $1,971 mechanical breakdown protection policy for a total monthly loan payment of $336. Our vehicle financing option saved our member a total of $6,900 in finance charges and $799 of GAP insurance costs, compared to what the dealership offered.
The member chose us! To make the offer even better she qualifies for the Loan Benefit club discount of 0.25% for additional savings on her loan because set up her payment on auto pay from her direct deposit.
I applaud Lisa and our underwriter for looking out for the best interests of our member and helping her secure a much more favorable auto loan than the higher rate financing offered at the dealership.
Likewise, your credit union is really looking out for you and we’re ready to offer you better rates and excellent service. If you’re not a member, what are you waiting for? Contact us today.
Consumer Loan Manager
* GAP Insurance covers the difference between the actual cash value of a vehicle and the balance still owed on the financing (car loan, lease, etc.).