Financial firms team up for online auto loans

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by MICHAEL MEEHAN

(IDG) -- Looking to automate the car loan process, J.P. Morgan Chase & Co., AmeriCredit Corp. and Wells Fargo & Co. this week said they are launching a new lending Web site called DealerTrack.com Inc.

The site will be run as an independent business and boasts 4,000 auto dealerships as members of its network. The idea is for auto dealers to submit online credit applications to multiple lenders and quickly come back with a loan for their customers.

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The founders said the networks will make auto loans convenient much the same way automated teller machines made cash withdrawals a simple procedure.

"We see the use of technology as critical to our long-term success," said David Coulter, vice chairman of New York-based J.P. Morgan Chase.

The vehicle loan portfolios of the three lending institutions each tallies in the billions. Dealerships will be able to log onto the Web site for free and the company will make money by charging a transaction fee to the lending institutions that offer the loans.

According to the founders, another 10 regional banks have filed letters of intent to join the network.

DealerTrack's founders didn't disclose how much they paid in start-up costs and declined to set a timetable on when the Web site can turn a profit.

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DealerTrak.com Inc.
Wells Fargo & Co.
AmeriCredit Corp.

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