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Auto Loan and Collection Challenges in 2022

The collection plays a significant part in your institution’s financial health. An auto loan is definitely one of the areas the debt collection team has been facing challenges. While auto loan delinquency has remained low, a moderate increase in auto loan delinquencies is expected this year. Limited resources, personnel, and time are common denominators for many collections departments. However, as per research conducted by major credit unions, there has been a substantial increase in auto loan market share.

In this article, we’ll focus on auto loan and collection challenges in 2022. So, let’s not waste any time further and focus on critical areas.

Lack of Automation

A common challenge we see in the auto loan collection sector is an increase in the workload of their collectors. This is generally due to the lack of technology and automation. As a result, collectors face multiple manual processes that make their collection process inefficient; it also increases the opportunity for human errors.

Disjointed communication

The agents need to keep in touch with their superiors, counterparts, and customers. Moreover, communication is an essential part of the process. With a streamlined platform, communication can occur via email, phone, or in-person.

Tracking workflow is a vital part of the process. You need to get the accurate status updated to enhance your collection activities.

Dependency on multiple programs

You need to work with the dependence on multiple systems. They typically need to stick to various techniques, notate collections activity, process payments, add notes, etc. This may cause inefficiencies, reducing the number of calls a collector can take per day.

Auto companies are losing 20-30% in revenue each year; as a result, due to inefficiencies, you must create ways to combine tasks and services and further improve efficiencies to create a productive workforce.


Under the latest administration, the CFPB is expected to be much more active. The consumer treatment in repossessions is a primary concern here. The lenders are optimizing deficiency balances before taking collection actions against borrowers.

Queuing capabilities

When inefficiencies exist, a significant challenge exists, especially when operations face a streamlined and accurate way to queue their calls. There have been efficient ways to switch gears if their priorities change.

Dependency on IT

It’s not uncommon for financial institutions to experience a strain on their IT resources. Automotive debt collection operations are no different. In addition, the more systems and platforms used to perform day-to-day tasks, the more likely it is that updates will be needed and issues will occur that will require IT involvement.

If you can relate to many challenges, know that there is hope. When embracing change through technology deployment, it helps solve the institution’s most prevalent collection challenges.

Final Wrap

The size and length of auto loans continue to increase in automotive debt collection. This certainly puts pressure on consumers and creates challenges for finance companies and credit unions. However, having a strategy can help your business reduce delinquent payments and ensure more loans get paid on time.

At Vital Solutions, we offer the most advanced technology in automotive debt collection. Get in touch with the experts for more details.