Auto Finance News | The News That Drives the Industry

Despite Improvement in May, ABS Credit Performance Likely to ‘Deteriorate,’ KBRA Says

After 16 straight quarters of improvement, credit quality in prime auto loan securitizations will start to “deteriorate,” according to a newly released report from Kroll Bond Rating Agency. While May servicer reports showed improving credit performance across prime and nonprime auto securitizations, performance is predicted to weaken through the summer months. “With the effects of the […]

More Prime Consumers Opt for Used Cars as Subprime Loses Share

As the percentage of prime and super-prime used-car buyers reached an all-time high in the first quarter, the percentage of subprime loan originations fell to a record low, according to Experian’s Q1 2019 State of the Automotive Finance Market Report published today. “The trend of more prime consumers entering the used market is one we’ve […]

Auto ABS Volume Closes In on $60B

Year-to-date auto securitization volume hit $57.8 billion at the end of April, with prime loan issuance accounting for the lion’s share of transactions, according to research released today by Deutsche Bank. Prime loan securitization volume totaled $23.7 billion, and subprime volume reached $12.8 billion. The remaining volume was comprised of retail lease ($9.8 billion), fleet […]

Extended-Term Contracts Lower Credit Quality in Bank of the West Securitization

Extended-term contracts, an increased loan-to-value ratio, and a rise in the number of loans with lower Fico scores are responsible for weakened credit quality in Bank of the West’s $764 million auto trust securitization — the bank’s first of the year — according to a Fitch Ratings’ presale report. The average term of loans securitized […]

Despite Improvement in May, ABS Credit Performance Likely to ‘Deteriorate,’ KBRA Says

After 16 straight quarters of improvement, credit quality in prime auto loan securitizations will start to “deteriorate,” according to a newly released report from Kroll Bond Rating Agency. While May servicer reports showed improving credit performance across prime and nonprime auto securitizations, performance is predicted to weaken through the summer months. “With the effects of the […]

CFPB Supervisory Highlights Provide Guidance on Deficiency Balances and Rebates

Under Richard Cordray’s Consumer Finance Protection Bureau (CFPB), it was “compliance malpractice” not to take heed of the Bureau’s enforcement actions when determining how to comply with federal consumer finance laws. Both Acting Director Mick Mulvaney and current CFPB Director Kathy Kraninger have stated that the Bureau will no longer engage in such “regulation by enforcement.” While this change in position is […]

Senators Urge Regulatory Oversight of AI to Prevent Discrimination

As auto lenders increasingly turn to technology like artificial intelligence to improve business practices, two senators are pressing regulators to ensure anti-discrimination laws keep up with the innovation. Sen. Elizabeth Warren (D-Mass.) and Doug Jones (D-Ala.) sent a letter to the leaders of the Consumer Financial Protection Bureau, Federal Reserve, Office of the Comptroller of […]

Extended-Term Contracts Lower Credit Quality in Bank of the West Securitization

Extended-term contracts, an increased loan-to-value ratio, and a rise in the number of loans with lower Fico scores are responsible for weakened credit quality in Bank of the West’s $764 million auto trust securitization — the bank’s first of the year — according to a Fitch Ratings’ presale report. The average term of loans securitized […]

Decline in Used-Vehicle Inventory Dampens Dealer Sentiment

Used-car sales – a driver behind recent market strength – may slow as used-vehicle inventories shrink, according to Cox Automotive’s second-quarter Dealer Sentiment Index report published last week. “If market strength is being driven by used vehicles, can used-vehicle sales remain strong considering declining inventory?” Cox Auto Chief Economist Jonathan Smoke said in a statement. […]

Santander’s Calling System Still Violates TCPA, Court Finds

Santander Consumer USA’s Aspect calling system will still be considered an automatic telephone dialing system under the Telephone Consumer Protection Act, according to a recent federal court decision. The motion to reconsider filed in U.S. District Court for the Northern District of Illinois was based on the premise that the definition of an autodialer changed […]

Carvana Hits ABS Market With Second Transaction

Carvana is bringing $337.3 million in asset-backed securities to market in a deal that’s expected to close June 27, according to a presale report by Moody’s Investors Service issued this week. Carvana’s second deal of the year props up its ABS volume to $676.1 million just three months after the online used-vehicle retailer completed its […]
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