SOUTHFIELD, Mich. –

Credit Acceptance Corp. recently completed $385.0 million in asset-backed non-recourse secured financing.

Pursuant to this transaction, Credit Acceptance contributed loans having a net book value of approximately $481.4 million to a wholly-owned special purpose entity that will pledge the loans to institutional lenders under a loan and security agreement.

Executive highlighted this financing will:

• Bear interest at one-month LIBOR plus 195 basis points

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

• Be used by us to repay outstanding indebtedness and for general corporate purposes

The company noted it will receive 6.0 percent of the cash flows related to the underlying consumer loans to cover servicing expenses. The remaining 94.0 percent, less amounts due to dealers for payments of dealer holdback, will be used to pay principal and interest to the institutional lenders as well as the ongoing costs of the financing.

“The financing is structured so as not to affect our contractual relationships with our dealers and to preserve the dealers’ rights to future payments of dealer holdback,” Credit Acceptance officials said.