The credit facility of BMO Harris Bank will enable Snap Finance to serve more than $1 billion in lease-to-own finance agreements, the companies announced today.
The $100 million credit facility will allow Snap Finance to “continue to expand with new merchant partners and increase capacity,” and will help “even more businesses grow” in terms of customer financing, Matt Hawkins, founder and chief executive of Snap Finance, said in the release.
BMO Harris Bank acted as an agent to the credit facility, according to a press release, and this deal has marked “the largest bank revolving credit facility ever” for a private consumer lease-to-own company.
For this deal, BMO Harris has evaluated Snap Finance in the areas of “regulatory oversight, compliance, confidence in the business model, financial performance, integrity of leadership, maturity of business, plans for growth, and customer relations,” according to the release.
The credit facility is being provided by a syndicate consisting of First Tennessee Bank, BMO Harris Bank, BankUnited, and First Tennessee Bank.
Separately, Chicago-based BMO Harris is fostering greater collaboration between its retail consumer auto loan business and commercial dealer finance arm in search of opportunities to extend credit to dealerships in the U.S., Craig Harter, head of the company’s indirect auto finance group, told Auto Finance News last month. One way BMO Harris is encouraging dealer growth is through an acquisition financing program, where dealers with two or three stores can acquire funds to add another store.
The added cooperation between the two wings of the bank comes as it shifts to a three-tiered flat rate dealer compensation model, rather than a single 3% flat rate.
