How Randolph-Brooks Federal Credit Union Drives Loan Growth While Strengthening Member Relationships

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Open Lending Gradient Background

Randolph-Brooks Federal Credit Union loves helping its members achieve financial success. Historically, RBFCU had been conservative with its underwriting — but the credit union wanted a way to reach more members by taking a closer look at near- and non-prime borrowers’ potential. To make this possible, they turned to Open Lending.

Randolph-Brooks Federal Credit Union — a $9.3 billion institution in Universal City, Texas — wanted to engage more members, particularly those underserved by traditional financial institutions. Access to auto loans is critical for low-income families that need reliable transportation in their daily lives, and RBFCU needed a way to make a difference.

“We have always been an advocate for our members,” said Heather Sullivan, Senior Vice President of Consumer Lending, “but when it came to underwriting, we were always very conservative and wanted to be more inclusive and wanted to increase our car loans.” 

It was important to RBFCU to find a partner with vast experience in the near- and non-prime auto lending market. 

“We felt more comfortable going with Open Lending rather than entering uncharted waters by ourselves,” Sullivan added.

Lenders Protection™ offered a safe way for RBFCU to increase near- and non-prime auto loan volumes and yields without adding risk to their loan portfolio. With built-in default insurance, the program allowed RBFCU to model their specific overhead and funding costs and set a target ROA for their insured portfolio. The result: a profitable auto loan portfolio with carefully managed pricing and risk characteristics.

Data-Powered Decisioning

After exploring a variety of loan decision engines, RBFCU was compelled by Open Lending’s modernized underwriting process. 

“We were really impressed with the decision engine because it brings in different statistics and alternative data,” Sullivan said. “Open Lending has been great about explaining what [the information is] telling the credit union. We see data that piqued our curiosity and analytics that have a story to tell.”

Open Lending also shapes lending strategy using insights from its 20+ years of proprietary client data. 

“Open Lending’s vast experience in the near- and non-prime lending market, across hundreds of financial institutions, allows us to bring a wealth of knowledge to each of our clients,” said Matt Roe, Open Lending’s Chief Revenue Officer. “That really helps us guide our clients toward the path to success in a market where few have expertise and a winning track record. Randolph-Brooks has really taken our insights and consulting and run with it.”

Say Yes To More Auto Loans

RBFCU employees are happy to stand up as ambassadors for the Lenders Protection™ program, Sullivan said. 

“Our employees like being able to say yes. They’re hearing from the members and feeling for the members. They love to get involved in what they’re trying to accomplish and save them from going to a ‘buy here, pay here’ lot. It helps them feel good,” she said. 

In instances where members are unable to fulfill their payment obligations, RBFCU follows its standard collections process. The credit union allows a 15-day grace period and then makes calls to help the member catch up. It also has a skip-a-pay option for short-term hardships. 

“Our goal is not to repossess the vehicle. We want to try to help our members be successful,” Heather said.

Improve ROA and Member Experience

RBFCU’s results have been outstanding. The credit union approved 17,177 loans in 2018 that it would not have approved without Open Lending’s Lenders Protection™ program. In 2018, these loans equaled $109 million of RBFCU’s $400+ million in auto loan growth. RBFCU’s total return on investment in the Lenders Protection™ program was 3.85%.

On top of its financial success for RBFCU, the program has helped members feel valued and employees feel like they’re making a difference. 

“Lenders Protection™ helps our credit union to make more respectable loans to our members. When we considered what we’d been doing, we looked at the data and many cars were low-priced and reliability was questionable,” Sullivan explained. “Now, with Open Lending’s Lenders Protection™, RBFCU is able to make higher-dollar loans for cars that tend to be more reliable, and it helps families be more successful in getting loans.” 

For members, the application process for a loan with Lenders Protection™ is no different from a standard auto loan application. This allows all members to have a respectful experience, regardless of their credit score.

An Ongoing Partnership

Open Lending remains actively involved with RBFCU. Open Lending team members facilitate onsite trainings for the credit union’s 170-person call center staff and underwriters, and dedicated account managers provide consistent data updates and analysis. 

To Sullivan, Open Lending’s ongoing support combined with Lenders Protection™’s 20+ years of proprietary data and risk analytics is the recipe for a “fantastic partnership.”

Interested in using Lenders Protection™ to make a difference at your financial institution? Schedule a demo.


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