Spring Tree Lending LLC intends to use a recently acquired line of credit to increase its purchases of auto loans and portfolios, Chairman Daniel Galvanoni told Auto Finance News.
Atlanta-based Spring Tree, a subsidiary of DPG Investments LLC that buys and services nonprime auto loans from dealers and other lenders in the southeastern U.S., last week closed on a line of credit provided by Spartan Financial, a unit of American Credit Acceptance LLC.
Though neither company would disclose the size of the credit line, Galvanoni said he hopes it will expand to $10 million.
“We’ve got plenty of equity, and we plan to be very aggressive in this space,” he said. “This, to me, is one of the greatest opportunities I’ve seen [in auto finance].”
The company deals in deep- and near-prime assets, and Galvanoni says he’s not afraid of the risk associated with that market.
“You have to do your work,” he said. “We do things to safeguard ourselves so we’re not taking that origination risk.”
This is a time of consolidation in the industry, he added, and “we’re going to be an acquiring consolidator ourselves. We’re looking at this as a large industry that can be consolidated into rollups or purchased in portfolios.”
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