Used vehicles have long been the auto category where credit unions win. The rate battle on new cars belongs to the captives, which can subsidize financing to move inventory. Used cars have the volume, the payment-sensitive borrowers and the dealer relationships that suit credit unions. Lately, though, the numbers have moved the wrong way.

An October 5 piece in CUInsight by Josh Amaton, vice president of dealer client experience at Origence, lays out the slide using Experian data. One caution up front: Origence sells the CUDL lending platform and decisioning technology, and the article’s prescription is largely the kind of technology Origence sells. The third-party data it cites is worth taking seriously, and we’ve checked what we could against the original sources. The fix it proposes is a lending-operations answer. For the people reading this, there’s a marketing answer too, and it’s faster to put in motion.

Credit Unions Have Trailed Banks in Used-Auto Share for Two Straight Years

According to Experian’s State of the Automotive Finance Market report, banks held 28.59% of used-vehicle financing in Q2 2025 and credit unions held 27.63%. Origence reports that Experian’s Q2 2026 figures put banks at 28% and credit unions at 26.2%. We could not access the Q2 2026 used-vehicle breakdown directly, so treat that second pair as reported rather than independently confirmed. If it holds, the gap roughly doubled in a year, from under one point to nearly two.

The total auto market tells the same story in a confirmed number. Experian has credit unions at 20.38% of all vehicle financing in Q2 2026, down from 21.04% a year earlier, while banks lead at 27.15% and captives hold 26.26%. A loss of two-thirds of a point sounds small until you remember what it represents in a market measured in hundreds of billions of dollars. For a credit union whose loan-to-share ratio depends on auto, a shrinking share of originations shows up as slower loan growth in the board packet and more pressure to deploy deposits somewhere riskier.

If you market for a bank, read this as a thin lead rather than a moat. Banks pulled ahead in used auto partly because they leaned back into the category, and a one- or two-point margin can reverse in a couple of quarters. Your refinance offer is also the weaker one in the data, which matters for the section below.

Used Cars Are Where Payment-Stressed Buyers Are Landing

The demand is there. CarGurus’ mid-year 2026 report says average new car list prices crossed $50,000 this spring and average used prices passed $30,000. The average gap between new and used prices has widened from about $13,000 in 2015 to $21,000 in 2026, and CarGurus estimates new-car monthly payments run about $180 higher than used. Shoppers who would have bought new five years ago are financing a used car instead.

The used loans themselves are getting bigger. Experian puts the average used-vehicle loan at $27,852 in Q2 2026, up $875 from a year earlier, with an average monthly payment of $542 and an average used rate of 11.19%. That is a lot of payment on a lot of interest. For a credit union with a rate advantage, every one of those borrowers is a refinance prospect the day after they sign at the dealership, and most of them will never hear from you unless you go find them.

CarGurus also found that vehicles 7 to 10 years old made up 23% of used sales by mid-2026, up from 17% in 2020. Older collateral with more miles changes how your lending team prices risk, and it changes what your marketing can promise. A campaign built around “any car, any age” works against a credit committee that is tightening on high-mileage vehicles.

The Risk Side Is Why Lending Will Push Back on a Volume Campaign

Subprime auto delinquency hit a record this year. Fitch Ratings’ 60-day delinquency index for subprime auto securitizations reached 6.90% in its January reading, the highest since Fitch began tracking in the early 1990s. Origence reports it eased to 5.8% by June. Prime delinquency, by contrast, stood around 0.43% at the end of 2025. Experian says subprime borrowers made up 20.60% of used-vehicle financing in Q1 2026, up from 19.36% a year earlier.

Fraud is the other pressure. Point Predictive, a company that sells fraud-detection tools to auto lenders, estimates auto lending fraud exposure at a record $10.4 billion in its 2026 report, up from $9.2 billion the year before. It attributes 69% of that exposure to first-party fraud, meaning borrowers or dealers misrepresenting information, and says income and employment misrepresentation alone accounts for 45%. Its Early Payment Default Risk Index sits at more than double its 2017 baseline. These are vendor figures from a company with a product to sell, drawn from its own consortium data, and they should be read that way. They still match what lenders describe.

For marketing, the takeaway is practical. Any campaign that drives raw application volume into subprime used-auto without coordination will collide with a lending team watching delinquency and early defaults. Build the plan with them, target the segments they want more of, and you get budget renewed next year instead of a campaign pulled in month two.

Credit Unions Own Refinancing, and Most Aren’t Marketing It Hard Enough

Refinancing is where the credit union advantage is widest and least contested. Experian reported that credit unions handled 63.43% of auto refinancing in Q1 2026. In Q2 2026, borrowers who refinanced with a credit union saved an average of $102 a month, compared with $65 at banks and $38 at finance companies. Experian also found that loans were refinanced an average of about 26 months after origination.

That 26-month figure is a targeting instruction. Members who financed a used car at a bank, a captive or a buy-here-pay-here lot around two years ago are sitting in the window when refinancing typically happens. Many of them already have checking at your credit union, which means the auto tradeline on their credit file is visible through a prescreen and the payment is often visible in their own transaction history. Recapturing those loans adds to used-auto originations without competing at a single dealer desk.

Gen Z is the other reason this matters. Equifax’s 2025 Auto Insights Report found 29% of Gen Z auto loans come from credit unions, the highest share of any generation. Plenty of those come through indirect channels, where the borrower picked a car and the dealer picked the lender. That young borrower may not know they’re a member. If nobody follows up, the credit union carries the credit risk of a thin-file borrower without the checking account, direct deposit or card relationship that would make the loan worth it over time.

Lending Controls Dealer Speed. Marketing Controls Everything Around It

The Origence piece is right that indirect volume follows decision speed. Dealers send deals to lenders who approve fast and fund through eContracting, and a slow decision engine loses deals no ad budget will win back. It cites Centris Federal Credit Union, a $1.3 billion credit union in Nebraska with more than 135,000 members, which adopted AI underwriting through Origence and Zest AI in 2024. Centris raised its share of automated decisions from 43% to 63% and credited its loan origination system with more than 30% growth in indirect volume. Rick Seamann, Centris’ vice president of indirect lending, described faster dealer decisions as “a win-win-win for the credit union, the dealer, and the member.” Note that the case study was written by Origence, Centris’ technology provider.

Marketing doesn’t own the decision engine. It does own the channels where the dealer isn’t the gatekeeper, and those are where the share can move fastest.

Four Moves That Put Marketing in the Used-Auto Fight

1. Run a standing refinance recapture program

   Work with lending to pull members who carry an auto loan with another lender, prioritizing loans booked roughly 18 to 30 months ago, since Experian puts average refinance timing near 26 months. A prescreened firm offer of credit, sent by mail and email and followed up in digital banking, puts your rate advantage in front of people who are already paying someone else. This works because the borrower already has the car and the payment pain, so you’re competing on savings alone, which is the comparison credit unions win in Experian’s data.

   Prescreened offers carry Fair Credit Reporting Act requirements, including the firm offer and opt-out notice. If the creative mentions a payment amount or a dollar savings figure, Regulation Z trigger-term rules can require additional disclosures. Run the full package past compliance before launch, and make sure any savings example is clearly labeled as illustrative.

   Try this: Ask lending for a monthly file of members with external auto tradelines and set the refi campaign as an always-on program in your marketing automation rather than a once-a-year promotion.

2. Get pre-approvals in front of used-car shoppers before the dealer does

   A member who walks onto a lot with financing already approved is a member the F&I office can’t easily redirect. Pair paid search on used-car shopping terms in your market with targeting of members whose behavior suggests a purchase, such as an aging auto loan nearing payoff. Then check what happens after the click. If your direct auto application loses most people before they submit, more ad spend just fills a leaky funnel, a pattern we covered in our look at digital application abandonment.

   Try this: Pull the field-by-field drop-off report for your direct auto application in GA4 or your LOS and fix the worst step before you raise the search budget.

3. Onboard every indirect borrower like a new member, because they are

   Build a 90-day sequence that starts the week an indirect loan books: a welcome that explains who you are and why the loan is with you, an easy payment setup, then a checking or direct deposit offer. For Gen Z borrowers this is the first real relationship with a financial institution, and for your balance sheet it’s the difference between a risky one-product loan and a member. The first months also matter for risk. Point Predictive defines early payment default as non-payment within the first six months, so a welcome contact that confirms the borrower’s details and payment method gives your collections and fraud teams an early signal.

   Try this: Add an “indirect auto, booked in last 30 days” segment to your CRM and measure what share opens a checking account within 90 days.

4. Only advertise the speed lending can document

   If your decisioning has improved, tell dealers and members, with the numbers lending can stand behind. “Decisions in minutes” is a claim a regulator or a frustrated borrower can test, and an overpromise is a UDAAP problem as well as a dealer-relationship problem. Ask lending for median decision time and auto-decision rate by month, use only what holds up, and update the claim when the numbers change.

   Try this: Put auto-decision rate and median time-to-decision on the same monthly dashboard as your campaign results so both teams see the same numbers.

Measure Recaptured Loans and New Relationships, Not Just Applications

Application counts will flatter a bad campaign. The board and the lending committee care about funded loans, credit quality and whether auto borrowers stay. Report results in those terms and break them out by channel so you can tell which program is actually moving share. If your attribution between digital campaigns and funded loans is still patchy, our piece on the measurement gap heading into 2027 covers where it usually breaks.

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