Technology Helps Collectors Enforce Prompt Payments on Auto Loans
Many lenders are looking to fund a little deeper credit scores and are getting creative in their financing since the captives are taking most of the A+ borrowers at 0% financing up to 60 months. Lender Systems in Temecula, CA. has traditionally worked in the Buy Here, Pay Here arena but more Financial Institutions are looking at the benefits of the iPAY system. For non-prime lending a financial institution can minimize their risk and change the dynamics of the collection process because borrowers are now calling the lender if they are behind in their payment to make a “promise to pay” or go to a local branch. “Our goal is not to have the vehicle not start” says David Sailors, Executive Vice President of Lender Systems, “but to help maintain responsible borrowers and help them rebuild their credit”. Many Financial Institutions are looking at the program to assist with 1st time car buyers and non-prime borrowers which yields a greater return on that portion of their portfolio and reduces the lender’s risk. Ken Landis, CEO at Pasadena Service FCU says that “the member benefits because as long as they make their payments on time the unit acts as an Anti Theft device because of the GPS that is part of the payment reminder system”. The average yield on his portfolio is 11% with no delinquencies on loans that he would have normally turned down in the past.
Lender Systems unique technology is being used for reinstatements as well. The system has been a great asset to collectors who are reinstating vehicles with members that have a checkered payment history. Collectors that are enforcing the technology are finding that they have greater control over a member’s payment behavior. Many credit unions have used the product when certain circumstances have called for it upon a repossession of a vehicle. The iPAY device is not meant to replace the financial institutions loan policies, but rather enhance what the financial institution can do to make more loans and help their borrowers get into a vehicle. These borrowers are saving upwards of 10% on their interest rate and if they pay on time, increasing their FICO score so that they can get a better rate the next time they purchase a vehicle.
Headquartered in Temecula, CA, Lender Systems, Inc., is a solution oriented company with focus on risk management strategies for the non-prime and sub-prime financial market.
Lender Systems’ core solution consists of payment assurance technology products developed by RFIS, a leader in automotive related technology solutions. In addition, Lender Systems provides full service loan servicing as an option for its clients that choose to outsource their collection needs. Lender Systems mission is to provide a comprehensive set of integrated tools for seamless risk management solutions.
Its proprietary systems and solutions are used to secure and manage the sub-prime auto loan portfolios of both buy-here-pay-here auto dealerships and financial institutions.
Its asset protection systems secure the multi-million dollar inventories of automotive dealerships, credit unions and other types of financial institutions. Technology provided by Lender Systems, Inc is currently protecting more than $2 billion in auto loan portfolios and has been serving the industry for more than 18 years.
Lender Systems, Inc is committed to delivering differentiated value to customers and partners through its unique product and service offerings, while closely mapping products and solutions to its customers’ needs and priorities-such as asset securitization, productivity, cost savings and return on investment.
The Lender Systems staff has industry wide background and consists of former employees of Manheim, On Time®, Finance Express, PassTime™, Reynolds & Reynolds, Sekurus, Star Billing (a 10 year billing and loan servicing company in the sub-prime auto industry), Microsoft®, and several financial institutions. Several former Sekurus, On Time® distributors and its direct sales staff are also now part of the Lender Systems, Inc. group.
Thomas R. Nance
Lending Edge Solutions
1403 Madison St.
Tustin, CA. 92782