Dort Financial CU extends terms for add-on products amid high costs

Dort Financial Credit Union is allowing for term extensions so consumers can afford to add back-end products such as service contracts on loans and leases as vehicle prices climb and leasing gains traction. “The cost of backend products [has] virtually doubled in price” since prior to the pandemic, Ken Hedrick , vice president of consumer lending, told AFN . “On the indirect side, and on leases, our back-end products are popular,” he said. “We allow a larger dollar amount and a percentage of the purchase price to be added on for back products than some of our competitors do.” The Flint, Mich.-based credit union also will approve an additional three months on the consumer’s loan term if they add guaranteed asset protection coverage or add six months for a service contract or warranty, Hedrick said. He declined to provide further advance rate specifics. The extension “gives the member basically the same payment to be able to accept those products to protect the vehicle and not have to run into the expensive repair,” he said, noting that the credit union goes up to 84-month loan terms and up to 60 months for leases, but most consumers opt for loans at or under 72 months and leases of 36 to 39 months. ‘Affordability is key’ to leasing Increased leasing volume contributed to “record months” for the financier from March through May following a strong leasing year in 2025, Hedrick said. Dort Financial’s indirect auto loan and lease portfolio rose to $54.6 million as of May, up 105.3% year over year, he said, without specifying further. As of yearend 2025, its auto portfolio stood at $515.3 million, up 5.8% YoY, according to the latest Big Wheels Ranking data. Industrywide, leasing accounted for 24.1% of new-car purchases in the first quarter, down 168 basis points YoY, according to the latest data from Experian . Still, 72% of 59 credit union staffers said in a national survey they expect members to choose vehicle leases over a loan in the next six months, according to a Credit Union Leasing of America study published June 3. “Affordability is key in leasing; it gives members lower payment options [and] flexibility.” -- Ken Hedrick, Dort Financial Credit Union “We expect leasing activity to remain strong [in] the next 12 months,” Hedrick said, adding that Dort Financial launched leasing three years ago and is seeing an uptick in lease returns and buyouts in 2026. “Affordability is key in leasing; it gives members lower payment options than purchasing and gives them flexibility.” Monthly prime lease payments rose by an average $17 YoY to $611 in Q1, while the average lease term ticked up 0.64 months YoY to 36.94 months for prime borrowers, according to Experian. By comparison, the average monthly payment on a prime new-vehicle loan in Q1 was $774, with the average new-car loan term longer than 69 months. Leasing drives portfolio growth Basking Ridge, N.J.-based Affinity Federal Credit Union also has benefited from a rise in leasing, Brett Molloy , vice president of mortgage and consumer lending, told AFN . Leasing contributed to a 71.5% YoY increase in Affinity's auto portfolio to $1.4 billion in 2025 . Affinity’s auto portfolio climbed by $594.4 million YoY in 2025, according to Big Wheels. Leasing accounted for nearly half of that growth at $285 million, Molloy said. The credit union, he added, launched leasing in May 2022 and is seeing growth in lease buyouts as those cars return. “Leasing has been a primary strategy that we utilized early on for the growth,” he said, noting that Affinity’s auto portfolio growth in 2026 is largely being driven by refinance .

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Dort Financial CU extends terms for add-on products amid high costs

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