May 28, 2021 Case Studies, Insights
Meritrust Credit Union in Wichita, Kansas, had a very successful indirect lending program in 2015 and 2016. In a short time, their indirect lending portfolio doubled, but not long after, it moved toward aggressive underwriting to address tightening margins. Meritrust’s indirect portfolio soon experienced higher-than-normal losses.
Heather Gates, the Consumer Lending Director at Meritrust, oversaw direct lending at that time. Soon after, Meritrust’s leadership brought the direct and indirect lending programs together, and she was tasked with rebuilding the indirect portfolio through a sustainable and healthy strategy. Gates turned to Open Lending.
Gates shared that Meritrust decided to partner with Open Lending because trust had been built between the two organizations. Gates had initially met Open Lending’s Chief Revenue Officer, Matt Roe, at a conference she was attending, and while Meritrust didn’t feel it required Open Lending’s services at the time, both organizations stayed in contact. Since she was tasked with rebuilding their indirect program, Gates knew that the indirect lending program needed to develop a strategy to lend across all credit tiers again, and most importantly, do so with the proper risk mitigation in place.
Since partnering with Open Lending and implementing the Lenders Protection™ program in the summer of 2017, Meritrust has experienced tremendous success with its indirect lending portfolio. Their portfolio now has $52M in total loans with a WAR (weighted average rate) of 12.4%. In addition, Meritrust has safely made $25M of those $52M through the AutoPay program, to which Open Lending introduced the credit union. “We feel confident growing at this clip because we have a strong partnership with Open Lending,” Gates said. “This increases our ability to serve the auto loan needs of our communities in a way that is sustainable and prudent, and we are proud to help our members with purchasing the transportation they need.”
Say “yes” to auto loans with less risk! Learn more about Open Lending’s Lenders Protection™ program by clicking here!
During 2020, Meritrust faced the same challenges affecting the financial services industry as a whole as the global pandemic progressed. Through it all, Gates found the communication between Open Lending staff and Meritrust remained clear and in line with changes the credit union was making to its in-house underwriting as part of the strategy.
For other credit unions considering partnering with Open Lending, Gates had this advice: Understand why your organization would benefit from Open Lending’s Lenders Protection™ and build an intentional strategy around it for the best ROI.
“They don’t come in with just an out-of-the-box solution that fits everybody, but they really listened to the problem we were trying to solve and then said, here’s how, strategically, you can implement Open Lending.”
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