CACC - Credit Acceptance completes $389.9M asset-backed financing

• Credit Acceptance ( NASDAQ: CACC ) said Thursday it completed a $389.9M asset-backed non-recourse secured financing.
• The company contributed loans worth ~$500.1M to a wholly-owned special purpose entity.
• The entity will transfer the loans to a trust, which will issue four classes of notes.
• The financing will have an expected annualized cost of ~8.5%, revolve for 24 months after which it will amortize based on cash flows on the contributed loans, and be used to repay outstanding indebtedness.
• Credit Acceptance ( CACC ) will receive 4% of the cash flows related to the underlying consumer loans to cover servicing expenses.
• The remaining 96% will be used to pay principal and interest on the notes as well as ongoing financing costs.

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