CASE STUDIES and Testimonials
Learn more about our clients' experience with Stellar's Auto Loan Recapture Program. TestimonialsCase StudiesOur Clients’ Success is Our Success
The Stellar Financial Group’s success fee-based auto refinancing program provides real membership growth that is extremely profitable to our credit union clients. Stellar pays for 100% of all the marketing costs. The credit union only pays when loans are funded that can be directly matched back to our efforts.
Case Studies
$2.5B Asset Credit Union Case Study
BACKGROUND
This credit union (CU) is located in the Midwest and has an asset size of roughly $2.5B with 175,000 plus members. The CU has a community charter footprint with a potential membership of over several million households. The CU rates for A, B, C, D, & E paper of 4.14%, 4.84%, 7.19%, 8.94% and 11.69% for 60-month loans respectively (with a 620-credit score floor).
Stellar Auto Loans’ Proposal
Our clients pay no out of pocket marketing costs. All incentives, credit bureau lists, mail, postage, telemarketing expenditures, website, etc. are paid by Stellar Auto Loans, thus taking all costly risks from our clients. We collect a flat success fee from the funded loans that match back to the marketed consumers. A small application fee is assessed on all applications, which is waived when the loan is funded.
Implementation
Using the CU’s standard rates, the “Stellar Auto Loans” program targets non-member households that were eligible to become members. Potential mailed members are spread across all paper grades fairly evenly.
Approach
Stellar Auto Loans’ unique auto loan recapture program uses data mining of credit bureau consumer information to find households that are paying a substantially higher interest rate on their auto loan than what our client would charge for the same credit score, remaining terms, and remaining balances. Stellar Auto Loans then scrubs the potential list to remove those prospects that will not meet the CU’s credit policies (i.e., late payments, bankruptcies, number of open loans, etc.). Prospects are ranked by best responders as well as profitability.
The prospect is mailed a prequalified offer letter, which shows the monthly savings for that consumer, if they were to refi nance with the credit union. The direct mailer is supported by outbound calls, a custom microsite with application, reminder letters, digital marketing, and after hours inbound/outbound call service. Applications are completed and sent to the CU for approval and loan closure.
RESULTS
- 2020’s mailings resulted in $31 million+ in new, booked loans
- Members saved an average of $110.25 per month on their loans
- The average booked loan term was 60 months
- $6,615 average savings per household over the remaining life of the loan
- An average blended interest rate for all funded loans was 6.55%
ROI
- Estimated interest income for first 30 months: $5,085,669
- Estimated DDA (Demand Deposit Account) income for 30 months: $121,500
- Estimated 30-month non-interest income (GAP, MBI, etc.): $431,925
- Total Estimated Income: $5,639,095
Total Estimated ROI: 304%
$215M Asset Credit Union Case Study
BACKGROUND
This credit union (CU) is located in the Southwest and has an asset size of roughly $215M with 14,000+ members. The CU has a community charter footprint with a potential membership of 500K plus. The CU was not the market leader in rates. With rates for A+, A, B, C, & D paper of 4.99%, 4.99%, 6.99%, 8.99% and 12.99% for 60-month loans respectively (D paper has a floor of 550).
Stellar Auto Loans’ Proposal
Our clients pay no out of pocket marketing costs. All incentives, credit bureau lists, mail, postage, telemarketing expenditures, website, etc. are paid by Stellar Auto Loans, thus taking all costly risks from our clients. We collect a flat success fee from the funded loans that match back to the marketed consumers. A small application fee is assessed on all applications, which is waived when the loan is funded.
Implementation
Using the CU’s standard rates, the program’s targeted household mailings were split 95% to nonmembers (that were eligible to become members) and 5% to current members with loans held elsewhere. Potential members mailed were spread across all paper grades.
Approach
Stellar Auto Loans’ unique auto loan recapture program uses data mining of credit bureau consumer information to find households that are paying a substantially higher interest rate on their auto loan than what our client would charge for the same credit score, remaining balances, and remaining terms. Stellar Auto Loans then scrubs the potential list to remove those prospects that will not meet the CU’s credit policies (i.e., late payments, bankruptcies, number of open loans, etc.). Prospects are ranked by best responders and profitability.
The prospect is mailed a prequalified o ffer letter, which shows the monthly/yearly/lifetime savings for that consumer, if they were to refinance with the credit union. The direct mail offer is supported by outbound calls, a custom microsite with application, reminder letters, and after-hours inbound call service. Applications are completed and sent to the CU for approval and loan closure.
RESULTS
- 2020 mailings resulted in $9,184,684 in new, booked loans
- Members saved an average of $99.67 per month on their loans
- The average booked loan term was 64 months
- $6,378 average savings per household over the remaining life of the loan
- An average blended interest rate for all funded loans was 9.14%
ROI
- Estimated interest income for first 30 months: $2,098,372
- Estimated DDA (Demand Deposit Account) income 30 months: $41,500
- Estimated non-interest income (GAP, MBI, etc.): $67,800
- Total Net Income: $1,774,004
Total Estimated ROI: 409%
Testimonials
Read what some of our clients have to say about us…
SUCCESS STORY
Regional Federal Credit Union
Hammond, IN“We launched the Stellar Auto Loan program in January 2019. Our target audience is non-members within our community charter footprint to support our annual lending growth goals and promote the REGIONAL brand. The team at Stellar has been great to work with from the implementation into the ongoing marketing campaigns. We meet to review results and make adjustments to ensure the program’s success. We consistently receive applications submitted through multiple channels including our Call Center, in-branch and via the Stellar Application Portal. To date, we have booked over $1.4 million in loans and are running a 50% look-to-book ratio. The program has been a great compliment to our other marketing efforts.”
— Michael Peters
Executive Vice President
Regional Federal Credit Union
SUCCESS STORY
Trax Credit Union
Tampa. Florida
“We were looking for a creative partner and comprehensive program to increase loan growth and Stellar Strategic more than delivered. Their program manages to drive in existing and potential new members with loan dollars we would not have otherwise had. They handle most of the heavy lifting all with a reasonable fee and a high return on investment. They took the time to understand who we are as a credit union and gave us a few customizable marketing plans to choose from. Their business model is simple in nature but powerful with results. We wholeheartedly recommend Stellar Strategic.”
— Sammy Schomer
VP Lending
Trax Credit Union
SUCCESS STORY
Oklahoma Educators Credit Union
Oklahoma City, OK“Stellar’s unique strategy provides an opportunity to capture current performing loans. Since the program allows direct communication with the potential members, stronger underwriting capabilities are more easily maintained and the ability to cultivate deeper relationships with borrowers is accelerated… our Stellar Auto Loans relationship helps us to obtain LIFERS instead of just LOANERS.””
—Trent Vaughn
Senior Vice President
Oklahoma Educators Credit Union
SUCCESS STORY
Belco Community Credit Union
Harrisburg, PA
“We began our partnership with Stellar Strategic January 2020; since then the Stellar Strategic team has exceeded all of our expectations! Their marketing to potential members within our footprint has been extremely effective. Their insight has resulted in solid loan growth and high member satisfaction. Their representatives are able to contact applicants after hours if we are unable to make contact during the day, which adds another level of convenience and ease of service for our applicants. Everyone I have worked with at Stellar Strategic has been responsive and eager to help us grow. Partnering with Stellar Strategic has been a positive experience and I would highly recommend their services to anyone who wants to see loan growth.””
—Melissa Pender
Lending Sales Manager
Belco Community Credit Union
Learn More About The Program
Learn more about The Stellar Auto Loans Recapture Program.
Discover Your Market Potential
Learn more about the auto refi opportunity that exists In your market.
Explore the Program’s Next Steps
We make moving forward with the program as easy as possible!