Pelican Auto Finance will raise its longest loans to 66 months — compared with a maximum of 54 months previously — as the company said it closed a $100 million warehouse funding facility with Wells Fargo Securities.
“That is going to really make an impact in our franchise dealer network,” Pelican Chief Executive Troy Cavallaro told Auto Finance News on Wednesday. “It will enable them to sell their product to people who were not able to get those loans traditionally,” Cavallaro said.
In the rising interest rate environment, securitizations are something to be looked at, he said. “Interest rates are likely to rise by the end of the year,” he said. “This deal enables us to tap that securitization market, if needed.” The company announced that the new funding would also support further geographic expansion in the West and Midwest.
The improving economic environment contributes to a “bright outlook” for deep subprime, he said. “We are geared up to be a major long-term player in the deep subprime market,” Cavallaro said. “A lot of people are recovering post-recession, and that creates a huge market opportunity for us.”
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