How E-Signature Technology Accelerates the Auto Loan Process for Credit Unions
Coupe or sedan? Ford or Toyota? Private seller or used car dealer? Car shopping is a confusing series of costly options that can either lead to reliable transportation or leave you stranded on the side of the road. Shopping for a new (or, in my case, a slightly used, new-to-me) car is stressful enough without extra paperwork and financial negotiations. Before I even started my auto search, I knew that my credit union would handle the financing. With its online auto loan application and e-signature technology, financing could actually be the easiest step of buying a car.
On my third straight day of car shopping after many months of scouring online ads and classifieds, I began narrowing down my options. After bringing in my mechanics to compare the Top 2 contenders for my new ride, I decided on a red two-door hatchback Hyundai Accent last month. I was ready to sign and drive out of there in my new car as soon as possible – but first, at least traditionally, there's a maze of paperwork to tackle.
Now, this is where an e-signature can change everything, eliminating the hassle of physical paperwork to save time and add convenience. From the dealership – or really, from anywhere at any time – I can send all of the information electronically to my credit union across town, saving myself the 15-minute trip to wait in line at the branch. I can upload the purchase order from the dealer, and answer a series of simple questions to verify my identity. Click, send, and by the time I finish a celebratory lunch across the street, the dealer has received my approval letter. My new (used) car and accompanying loan are waiting for me, without requiring extra time and trips to the credit union to sign.
More and more credit union members are applying and signing for auto loans online; many of them, specifically, on a mobile device. A phone call may follow, and others still prefer to visit a branch, but there's no need. Every part of the auto loan process can be completed safely, securely and – best of all – speedily online.
As soon as members virtually seal the online loan deal with an e-signature on any computer or smartphone, loan officers at the credit union can process the loan within a couple of hours and shoot the required paperwork back to the dealer. It's easier, faster, and more convenient than driving back and forth from dealer to banker, wasting a lot of gas and paper in the process. You're not drumming your fingers on the lender's desk impatiently while you wait for paperwork to print or fax – and they're working more efficiently as a result.
Online applications, fueled by e-signatures, are becoming more necessity than luxury – especially for credit unions, which pride themselves on convenient member service that makes banking and borrowing more accessible. It's easy for the member and efficient for the credit union, saving time and money while enhancing compliance and reducing incomplete submissions.
As credit union loan volumes increase at a fast clip, institutions will turn to time-saving technologies to help manage the flow. Loan growth at credit unions is increasing faster than it has since 2005, growing nearly 10 percent in the second quarter to outpace – and nearly double – bank lending levels, according to the Wall Street Journal. Specifically, new auto loans jumped 17 percent to $77.7 billion, and used auto loans rose 12 percent to $135.3 billion. To process all those loans without sacrificing the personal service members expect, credit unions will have to deliver seamless online signing options that make auto loans easier for everyone involved.
Brooke N. Bates is a freelance business journalist, published author, blogger and marketing consultant based in Cleveland. Before launching her freelance business, BantaMedia, she worked as a digital marketing specialist for a credit union and as editor of interactive media at a national chain of business publications, where she managed strategy and development of print, digital, social, email, video and web content.