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CUNA Mutual Adds Five CUs for CPI

MADISON, Wis. - Five credit unions that did more than $200 million in vehicle loans in 2005, recently chose CUNA Mutual Group's Collateral Protection Insurance to help mitigate the risks of loss from damaged, uninsured vehicles. BrightStar Credit Union, MidFirst Credit Union, Chetco Federal Credit Union, Sun Federal Credit Union...

By Staff Writer | Updated on May 02, 2006

MADISON, Wis. – Five credit unions that did more than $200 million in vehicle loans in 2005, recently chose CUNA Mutual Group’s Collateral Protection Insurance to help mitigate the risks of loss from damaged, uninsured vehicles. BrightStar Credit Union, MidFirst Credit Union, Chetco Federal Credit Union, Sun Federal Credit Union and Fort Sill Federal Credit Union are the five new signees. The $259 million BrightStar CU, which switched to CUNA Mutual this year, concluded that a collateral protection program is “necessary” for any credit union offering indirect or risk-based lending programs, according to Fred Lindo, BrightStar’s vice president of lending. “BrightStar provides risk-based lending, and there is a greater need to protect these vehicles when insurance coverage isn’t obtained for one reason or another,” Lindo said. “We also have an indirect lending program, and although we may receive insurance information, it is not always reliable.” Nonprime and indirect are the fastest-growing segments of the vehicle lending market, said CUNA Mutual citing data from CNW Marketing Research. The research noted nonprime lending represents 20% of the vehicle market, generating $78 billion in loans in 2004, the last reported year. Ninety percent of all sub-prime loans come from indirect lenders, according to the data.

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