auto lending digital

COMPARING CREDIT UNION SOFTWARE VENDORS FOR AUTO LOAN SERVICING IN 2021

The defi Team Automation, Credit Unions, defi ANALYTICS, defi CONNECT, defi INSIGHT, defi SERVICING, Digital Loan Documents, Digitalization, Loan Management, Reporting & Analytics, Servicing Systems, Simplifying Processes

auto lending digital

If the events of 2020 have caused you to reconsider the efficiency of your auto loan and lease servicing capabilities, you’re not alone. 

Many credit unions have struggled with the challenges of efficiently handling loan and lease servicing, specifically the dramatic increase in servicing requests and the need to modify servicing processes to more efficiently handle the requests.

In 2021 you’ll find dozens of credit union software vendors offering auto loan servicing solutions. They range from global software vendors who offer products for dozens of different industries and U.S. companies exclusively focused on auto lending, to software vendors whose products, only with considerable effort, support some portion of auto loan servicing needs.  

We could develop a lengthy list of criteria to compare the pros and cons of various credit union software vendors, but for now, we recommend beginning with a few key criteria to help narrow the field. Specifically, look for the following capabilities.

#1 Support for the Entire Lending Cycle

Even though we’re focusing on auto loan and lease servicing, credit union software vendors that offer solutions for the entire lending cycle—loan origination to funding to servicing—are the better choice. They understand the benefits of having a smooth and secure transition of information and processes throughout the lending cycle. They understand the importance of an intuitive and consistent user experience for both borrowers and servicing agents.

Whether or not your servicing and loan origination solutions are provided by the same credit union software vendor, all relevant borrower information obtained during origination should flow smoothly into the auto loan servicing software to provide a single and complete view of the borrower. If your loan origination software is from a different vendor than your loan servicing software, make sure the servicing software vendor has proven experience in managing the integration of both systems. 

Building on the information obtained during loan origination, your servicing software should then be able to efficiently manage all borrower interactions associated with servicing, including welcome calls, inquiries via phone, email, and post, complaint capture and resolution, and default and collateral management. Details regarding borrower interactions, communications, documentation, payments, and resolutions should all be automatically and securely retained for both compliance and quality of service requirements.

#2 Easily Modify Software to Meet Your Unique Servicing Needs

You should be able to easily modify the servicing software functionality and processes to meet your unique requirements. Look for vendors who provide this capability via an extensive set of configuration menus that allow lending professionals to make these modifications. Configuration should cover:

  • User roles and access permissions such as compliance regulations that require a secure process to update the borrower’s name and SSN.
  • The user interface to determine which data are displayed, the sequence, and relevant menu options depending on the role or step in the workflow task.
  • Decision rules that translate your policies and processes into workflows that eliminate manual handoffs and help ensure consistent and efficient handling of both simple and complex servicing requests.
  • Queue prioritization for delinquencies, repossessions, loan or lease types, SLAs, etc. to ensure the most important items are handled first. 
Servicing software functionality can be easily modified by business
users via an extensive set of configuration menus.

System configuration menus provide the ability for business users responsible for the credit union’s servicing operations to quickly modify processes and policies. With configuration, you avoid the delays and costs typically associated with older servicing systems that require code-level programming.

#3 Integrated Analytics to Understand Process Efficiency

Well-designed modern auto loan and lease servicing software generates a wealth of operational data regarding servicing activities. To obtain the maximum benefit from that data, look for a credit union software vendor who provides integrated analytic capabilities. 

When analytics come pre-integrated with the loan servicing software, you won’t need the skills of a data scientist or SQL programming skills to gain insight into the efficiency of your servicing activities. 

Integrated analytics give credit unions up-to-date insight into important metrics that convey the overall health of their auto loan servicing business, answering questions like:

  • What developing trends are we seeing in auto loan servicing requests?
  • Which types of servicing requests take the most time to resolve? 
  • Where are the servicing process bottlenecks?
  • Is there a correlation between welcoming calls and fewer borrower complaints?
  • What account attributes strongly predict defaults?

Configurable dashboards allow business users to specify the data to explore, format of the reports, and graphical representations of the analyses. Users can either explore performance metrics at the summary level or drill into the data from multiple angles to explore the details of an individual transaction.

#4 Digital Auto Loan Servicing

Today’s borrowers want greater control over their accounts. They want secure access to current account information and the ability to manage transactions anytime, anywhere. They also want a digital lending experience, from loan origination to throughout the loan servicing phase. These capabilities should be part of your credit union software vendor’s solution.

A digital auto loan or lease servicing application allows borrowers to
verify account balances and manage other frequently-done lending activities.

An intuitive user interface available on desktop or mobile devices is a requisite for any loan or lease servicing software today. It gives borrowers round-the-clock convenience of managing account information and activities, which in turn reduces service center call volumes, allowing your agents to devote more time to members who truly need the assistance. 

In 2021, Some Credit Union Software Vendors Have More to Offer

When you’ve done your initial comparison of credit union software vendors using the above criteria, you’re likely to find that some credit union software vendors are far better prepared to address today’s auto loan and lease servicing needs. 

Investments in the latest technologies that boost process efficiency, improve the borrower experience throughout the lending cycle, provide flexibility in modifying software to meet changing market needs, and give lending professionals immediate insight into servicing efficiency and trends via analytics are critical to providing a superior auto and lease servicing experience. When comparing credit union software vendors, make sure they deliver on each of those capabilities and maintain a keen focus on the lending industry. 

Getting Started

defi SOLUTIONS provides configurable lease or loan origination systems, loan management and servicing, analytics and reporting, and a wide range of technology-enabled BPO services. If you’re struggling with the limitations of your current loan and lease servicing software, take the first step in learning how working with the right credit union software vendor can significantly improve your servicing operations. Contact our team today or register for a demo.

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