Launched in 2003, the Lenders Protection™ program is an auto loan enablement platform for direct, indirect, and refinance lending that combines the power of sophisticated risk-based pricing techniques, financial modeling, loan portfolio default modeling, automated underwriting, and default protection insurance. The program is owned and marketed exclusively by Open Lending Corporation.
By leveraging Lenders Protection™, auto lenders can generate more loans from existing application flow through expanded underwriting. Generate higher net yields through sophisticated risk-based pricing that includes all the factors that drive portfolio profitability and manage risk through high-quality loan default insurance.
Lenders Protection™ is available to all types of auto lenders throughout the United States. The program offers direct, indirect, and refinance lending options for banks, credit unions, and other specialized auto lenders. Currently, Lenders Protection™ is only available for personal-use automobiles and light trucks.
Each lender sets unique financial goals expressed as a targeted yield after all costs and expenses. Generally, lenders can earn 300% to 400% higher net ROAs on Lenders Protection™ loans than on their prime auto portfolio. Lenders Protection™ returns suggested contract rates based on the risk of the loan and the lenders’ targeted yields. These proposed contract rates also incorporate the costs to insure a loan in the program.
The Lenders Protection™ proprietary technology integrates seamlessly with many of the more popular auto loan origination systems. Application and process flow mirror the lender’s current operations, and complete loan structure and interest rate pricing recommendations are returned to the lender’s LOS in less than five seconds.
Manage risk through high-quality loan default insurance from insurance companies with “A” ratings by the AM Best ratings service. The insurance is designed to absorb more than 85% of expected deficiency balances. The insurance functions as a risk transfer mechanism so that actual loan losses mirror the lender’s prime auto loan portfolio. All costs of the program are reflected in the recommended contrast interest rate.
There are no upfront costs to start Lenders Protection™. There is no software to purchase, and you only pay for the loans you choose to insure.
Easy to use with no up-front costs and no software to purchase, Lenders Protection™ can be implemented in 30-60 days. Our implementation team and a dedicated account manager will guide you through a series of setup calls, configure your institution’s preferences and get your team trained and ready for launch.