<p>CU Times Editor-in-Chief MIAMI – Auto refinance promotions may be old hat for some credit unions, but not in the way some members are seeing the marketing efforts now. Members of Tropical Financial Credit Union, Miami who apply for auto refinance automatically receive a $200 rebate. In addition, those members who financed their original loan from a lender other than a captive finance company like GMAC, Ford Credit or Toyota Motor Credit, save an additional 50 basis points off their current loan rate. "Many members who finance their vehicles at the dealership make an emotional decision," said Bob Silverstein, senior vice president, marketing for Tropical Financial. "They fall in love with a car and think that just because they can drive it off the dealer's lot without having to leave the dealership that they've gotten the better deal. It's worth our while to offer them the $200 rebate to get their business back." Tropical Financial's auto loan portfolio is about $176 million, which represents more than a third of the $457 million credit union's total loan portfolio. Silverstein said the rates TFCU members get from other lenders "are all over the place," ranging from the very exorbitant to the more fair rates. "We usually wind up saving the overwhelming majority of them up to 3% off their auto loan which translates into about $50 a payment," he said. Most of the refinanced loans are within a year or two of the origination date. Tropical Financial has offered auto refinance promotions in the past, but the credit union never offered members an automatic $200 rebate on refinanced loans. "This is the first time we've done this, and our members are surprised. They keep thinking there's more to it, but there isn't. There's no catch." Bay Gulf FCU also has a track record of offering auto refis, but this year the $106 million credit union in Tampa decided to do things a little differently. In earlier auto refinance promotions, the credit union made offers like it would beat competitors' rates by 50 basis points or pay $50, this time Bay Gulf decided to target a promotion at its cream of the crop, A-plus members. Working with its MCIF company, Bay Gulf was able to identify those of its 20,000 members who were A-plus borrowers and who purchased a vehicle from June 2000-2001, and who financed the vehicle through another lender. Bay Gulf got back a list of about 400 members. "The best rates at the time on auto loans were 7.5%," said Mike Battoo, vice president of marketing, "and we're offering them 5.5%. Plus they're preapproved for these loans." Bay Gulf hasn't stopped there. It's providing these targeted members with a share draft they simply have to fill out to pay off the balance of their car loan. "The check works its way back to Bay Gulf and the loan stays on our books. It's that easy," said Battoo. Bay Gulf's auto loan portfolio makes up about half of the credit union's total loan portfolio. Bay Gulf's auto refinance promotion started in mid-December and will run until the end of January. "That gives them about six weeks, but it's so easy," said Battoo. "They don't have to call us or even walk through our doors. It doesn't get any easier than that." – [email protected]</p>