An executive with CUNA Mutual Group told credit union executives attending the company's Discovery Conference Wednesday that increased demand for vehicle loans can provide growth opportunities for credit unions.
"It is very important to be available to members through mobile means and to make sure all of your channels, including face-to-face interactions, complement one another," Steve Hoke, director of loan growth products for CUNA Mutual, said.
Hoke presented data from CUNA Mutual's loan application tool that showed consumers used a mobile device to make a loan application 25% of the time, while industry data indicated 63% of consumers shopped with a smartphone while on the dealer lot.
This increase in mobile use keeps consumers well informed throughout the process of purchasing a car, Hoke said.
"It is not such a linear journey, but rather a feedback-based process," he noted.
Members will look to their credit unions for financial feedback during this time, and mobile-optimized lending sites are key for successful communication with the member, Hoke added.
The financing duration has also increased with an average of 33.1% of car loans extending 72 months or longer, Hoke said.
Increased subprime auto lending has enhanced this trend, with roughly 33% of all new car loans approved for subprime borrowers, according to credit bureau data.
"Credit unions need to help accommodate members with these long-term obligations," Hoke said.
The Discovery Conference is an annual online event supported by CUNA Mutual that attracts a national and international credit union audience of more than 1,300 registered participants, according to the company.
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