Rocket Companies is expanding into auto lending – at a time when this market is in turmoil – with a new push to sell cars to its existing mortgage customers.
Rocket, whose mortgage arm is the nation’s largest mortgage lender, announced a partnership with fintech company AutoFi on Wednesday. The AutoFi platform allows customers to browse and select cars online before heading to a dealership, working with lenders to ensure buyers are pre-approved for loans.
AutoFi’s loan partners include JPMorgan Chase, Ally Financial, Ford Motor Credit, Royal Bank of Canada and Santander, according to its website.
Rocket Companies CEO Jay Farner said the partnership will increase the company’s access to vehicle inventory through more than 2,000 dealers in the AutoFi network. This access is “essential in today’s high-demand auto market,” Farner told analysts during an earnings call.
The vast majority of Rocket Auto’s current sales do not come from the company’s existing customer base as a whole, an earlier decision the company made to ensure the auto division can make a profit on its own “before it turns.” really rely on our customer base, ”said Farner.
But with a few years of experience under his belt, Rocket Auto “has just started to scratch the surface” of cross-selling, he said, adding that expanding vehicle inventory through the AutoFi partnership will be. essential.
Rocket Auto, which launched in 2017, facilitated the sale of 13,600 auto units in the first quarter, an increase of 5,300 from the same quarter last year. The AutoFi partnership will allow Rocket to help organize financing and insurance for customers who purchase vehicles, the company said in a press release.
Announcement comes amid pandemic auto loans boom, and this marks a new step in the digitalization of the car shopping experience.
Rocket Companies, the parent company of Rocket Auto and mortgage giant Quicken Loans, went public last year.