SOUTHFIELD, Mich. — Credit Acceptance Corp. recently completed $201.3 million asset-backed non-recourse secured financing.

Pursuant to this transaction, the company calculated that its contributed loans having a net book value of approximately $251.7 million to a wholly-owned special purpose entity that will transfer the loans to a trust.

Credit Acceptance highlighted how the trust will issue three classes of notes, including:

 Note Class 
 Amount 
  Average Life
 Price
 Interest Rate
 A  $161,500,000  2.45 years  99.98851%  2.20%
 B  $39,750,000  3.10 years  99.98367%   3.12%
 C  $95,146   3.21 years  —  —

Executives pointed out the Class C Note does not bear interest and is being retained by Credit Acceptance.

The company also shared how this financing will benefit the operation in three ways:

—Have an expected annualized cost of approximately 2.8 percent including the initial purchaser's fees and other costs.

—Revolve for 24 months after which it will amortize based upon the cash flows on the contributed loans.

—Be used by Credit Acceptance to repay outstanding indebtedness.

Executives went on to mention they will receive 6.0 percent of the cash flows related to the underlying consumer loans to cover servicing expenses. They added the remaining 94.0 percent, less amounts due to dealer-partners for payments of dealer holdback, will be used to pay principal and interest on the notes as well as the ongoing costs of the financing.

"The financing is structured so as not to affect our contractual relationships with our dealer-partners and to preserve the dealer-partners' rights to future payments of dealer holdback," Credit Acceptance officials emphasized.

"The notes have not been and will not be registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements," they added.

"This news release does not and will not constitute an offer to sell or the solicitation of an offer to buy the notes and is being issued pursuant to and in accordance with Rule 135c under the Securities Act of 1933," officials concluded.