SAN ANTONIO – San Antonio Federal Credit Union is going first again. Perhaps the first credit union in the country to do indirect auto lending, beginning nearly 20 years ago, the $1.8 billion CU now is the first to use DealerTrack's eContracting, a document system that SACU officials say is a final piece in making the end-to-end paperless deal a reality.
Software from DealerTrack, a New York-based specialist in connecting lenders and auto dealers, is already used by tens of thousands of dealers, credit unions and banks across the country. eContracting allows contract documents to be transmitted electronically to financing sources and funding to be received by the dealer, often in the same day.
Electronic vault capabilities also are part of the package. "We started with this July 1 and have done about 90 deals so far," says Chuck Smith, first vice president of lending for 232,000-member SACU, which also provides indirect-lending services to 19 other credit unions through its CUSO aptly named Credit Acquisition Resource Systems (CARS).
"eContracting fills in one of the last missing pieces of going from picking up the phones and calling in applications to the all-electronic deal," Smith says. "The entire package is now basically images on a secure Web site, including ancillary documents, a signature card if we need one, invoices, proof of insurance, copy of driver's licenses, all that.
"We just put it out to our partner on their secure FTP site and they do whatever they need to do with it. No more FedEx. No more runners. The dealers like it because they get their funds quicker, and we like it because it makes our operation that much more efficient." At SACU, working out bugs between the DealerTrack software and APPRO loan platform was among the challenges to deploying the new technology, but the big CU has some experience in these matters. Its staff has put a lot of time and effort into creating a system that originates, scores, underwrites and approves or declines loans, and interfacing it to the CU's core processing platform, and now is working on extending that reach into non-vehicle point-of-sale loans, such as for appliances.
"Now we need to get rid of the paper in our small-ticket financing," Smith says. "We've got the capabilities to do e-contracting there, too, but we haven't gotten there yet." That endeavor will come after an upcoming conversion from the CU's current IntegraSys core system to a new Symitar platform, Smith says. The volume has grown along with the technology.
"We did 4,300 indirect vehicle loans last month alone, and I anticipate that next year at least 50% of our volume will be electronic, if not more," Smith says. As for going first, "it does give us a sense of pride to see what we've been able to accomplish, but it really fits in with our overall theme of trying to make things as efficient as possible," the senior vice president of lending says.
"You've got to be able to compete, and with margins getting squeezed by interest rates, anything we can do to help, we're all for it."
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