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The Garage Partners with Flagship Credit Acceptance

By Richard L. Gaw
Chester County Press Staff Writer

Like most people who eventually become dedicated partners with The Garage Community and Youth Centers, Flagship Credit Acceptance executive vice president and general counsel Chris Keiser was introduced to the good work of the organization by friends of his from Chatham Financial, who was the founding corporation for The Garage when it was formed 17 years ago.

“They invited me to the holiday auction that the Garage hosts every year,” Keiser said. “Immediately, I found a synergy with some things in my past, through my support of Big Brother-Big Sister, Habitat for Humanity, and spending time in Latin America, speaking Spanish.”

The partnership between Flagship and The Garage may have taken root the day Keiser was first introduced to The Garage, but it was solidified through the infectious link Keiser saw between The Garage and its founding corporation.

“I remember seeing the folks from Chatham Financial working really hard for kids who may not have had the same opportunities that a lot of other kids do, to try to help them succeed academically, and in their post-academic careers,” he said.

“At the time, as I was starting to gain momentum with Flagship in 2014, the year it formed, our management team sat down and asked what it needed to do, and among those things was to create a community outreach program.”

Keiser proposed that the new company work with The Garage and now, several years later, it’s a firm commitment of engagement and volunteerism that will celebrate another milestone on May 20, when Flagship hosts a free, family-friendly Spring Fling at Hartefeld National Golf Club in Avondale. As part of the event, which will include vendors, food trucks, bouncy houses, games, putt-putt golf and face-painting, one lucky winner will be selected to receive a $10,000 grand prize from a raffle, that will also provide ticket holders a chance to win a second and third prize of $1,500 and $500.

Proceeds from the raffle and event will go to The Garage.

Headquartered in Chadds Ford, Flagship Credit Acceptance helps credit-challenged auto shoppers secure financing through partnerships with primarily franchised auto dealers and through its direct lending platform, CarFinance.com. It currently purchases indirect auto contracts from a nationwide network of over 9,400 dealers and originates direct to consumers in 46 states.

The company’s partnership with The Garage extends much farther than the upcoming raffle and community event. Flagship began offering volunteer time off (VTO) for its associates to work at The Garage’s functions in January 2016, which enabled its employees to get involved with The Garage’s annual holiday auction.

“I know that our Flagship volunteers really like The Garage,” said Janet Syphan, who helped coordinate the Spring Fling benefit with The Garage. “They feel like it’s a very worthwhile way to give back to the community that we serve. By offering each employee 16 hours off per year to provide assistance to The Garage, it allows them to take the time to give back to the community.”

Kristin Proto, The Garage’s executive director, sees the impact that Flagship employees have on young people who visit The Garage.

“I’ve heard Flagship employees say, ‘I remember when my kids were in middle and high school, and how hard it was for me as a parent,’” Proto said. “Having a teenager is just hard, regardless of what your background is, but having a teenager when you’re lacking in other resources compounds that. Flagship helps bridge that gap for so many of our kids.”

For Keiser, Flagship’s work with The Garage dovetails with the mission of the company, which is to provide not only resources and opportunities to purchase vehicles, but to educate consumers about the loan process. It’s an education he wants to establish at The Garage, in the form of non-intensive workshops taught by Flagship employees about money management.

“One of the initiatives I wanted to take hold is financial literacy for kids,” he said. “One of my frustrations is seeing people come out of high school with little knowledge of managing a budget, or knowing the importance of a credit score and paying bills on time. A program of this kind will allow Flagship to teach future consumers, early.”

“I think the door is wide open to continue our partnership with Flagship,” she added. “There are so many unique things that we can do now that we’ve spent the time to grow the relationship. It’s more than just writing a check with a logo on it.

“This is a vested effort to get even more Flagship employees to commit their time to us. It’s the chance to share information about The Garage, company wide, to hundreds of employees, to get more people in the door to help students and continue to spread the work of what we do in the community to others.”

The $10,000 winner will be chosen by one of the teens from The Garage at the event at 4 p.m. Individuals do not need to be present to win, and can purchase tickets online athttps://Go.RallyUp.com/Garage-Spring-Fling. Only 1,000 tickets will be sold, increasing participants’ odds of winning. Tickets for food and games can be purchased at the door.

To contact Staff Writer Richard L. Gaw, email rgaw@chestercounty.com.

Originally published in Chester County Press, online edition.

The Garage & Flagship Hold Free Community Spring Fling & $10,000 Raffle

When you walk into The Garage Community and Youth Center on most afternoons you will run into Jordan*. Jordan is in 7th grade but, due to a severe reading disability, reads only at a 1st grade level.

At The Garage, Jordan meets daily with a volunteer tutor who helps him step-by-step with his homework. He’s bonded with his Garage mentor. Stories like Jordan’s caught the eye of Flagship Executive Vice President and General Counsel Chris Keiser, who sought a long-term volunteer partnership for Flagship Credit Acceptance (Flagship). Flagship began offering volunteer time off (VTO) for its associates to work at The Garage’s functions in January 2016, which enabled its employees to get involved with The Garage’s annual holiday auction.

Flagship’s volunteers wanted to get more involved in this worthwhile cause, so to expand the partnership, Flagship will host a Spring Fling and Raffle including a $10,000 Grand Prize. Ticket holders also have a chance to win a second and third prize of $1,500 and $500. Proceeds from the raffle and event will go to The Garage. “Flagship is proud to give back to the communities we serve,” Keiser said. “We’re hoping that the community will enjoy this family-oriented event and come out and buy a raffle ticket in support of this great organization.”

The free family-friendly Spring Fling will take place on Sunday, May 20, from 12-4 pm, at beautiful Hartefeld National, 1 Hartefeld Drive in Avondale, PA, where the $10,000 winner will be chosen by one of the teens from The Garage. Individuals do not need to be present to win and can purchase tickets online at https://Go.RallyUp.com/Garage-Spring-Fling. Only 1,000 tickets will be sold, increasing participants’ odds of winning.

Tickets for food and games can be purchased at the door. Activities include vendors, food trucks, bouncy houses, games, putt-putt golf, face painting and more! “We are thrilled to be partnering with Flagship this year to give our students and our community a fun day through this corporate sponsorship,” said Kristin Proto, Executive Director of The Garage. “Our students rely on donations like Flagship’s to keep our space available to them year-round.”

*Jordan’s name has been changed to protect his privacy.

About The Garage

For the past 17 years, The Garage Community and Youth Center has been a key part of the community, providing resources and sense of belonging to area youth who are in need. Through tutoring, mentoring, computer lab access, recreation and special programs, some of our community’s most “at-risk” middle and high school students are finding the necessary support to reach their full potential.

KBRA Assigns Preliminary Ratings to Notes Issued by Flagship Credit Auto Trust 2018-1

Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to five classes of notes issued by Flagship Credit Auto Trust 2018-1 (“FCAT 2018-1”), an auto loan ABS transaction.

As of the January 11, 2018, statistical calculation date, FCAT 2018-1 contains $121.7 million of receivables and will contain approximately $164.6 million of receivables at closing out of an expected collateral balance of approximately $204.6 million after completion of the prefunding period. The transaction includes a prefunding feature that allows up to $40 million or 20% of the collateral pool to be funded after closing until April 20, 2018. The preliminary ratings reflect the initial credit enhancement levels of 42.01% for the Class A notes, 31.01% for the Class B notes, 19.01% for the Class C notes, 10.00% for the Class D notes and 4.25% for the Class E notes. Credit enhancement consists of overcollateralization, subordination of junior notes, cash reserve account and excess spread. The transaction is the first term ABS securitization in 2018 for the Company and its twenty second securitization overall.

This transaction includes loans originated from both the Flagship Credit Acceptance (FCA) and CarFinance Capital LLC (CarFinance) branded origination channels.

KBRA applied its Global Auto Loan ABS methodology as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure and Flagship’s historical static pool data. KBRA also conducted an operational assessment on the originator and servicer, as well as a review of the transaction’s legal structure and transaction documents. KBRA will also review the operative agreements and legal opinions for the transaction prior to closing.

For complete details on the analysis, please see KBRA’s Pre-Sale Report, Flagship Credit Auto Trust 2018-1, which was published today at www.kbra.com.

Preliminary Ratings Assigned: Flagship Credit Auto Trust 2018-1

Class Preliminary Rating Initial Principal Balance
A AAA (sf) $122,750,000
B AA (sf) $22,500,000
C A (sf) $24,560,000
D BBB (sf) $18,420,000
E BB (sf) $11,770,000

Representations & Warranties Disclosure

All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report available online.

Related Publications (available at www.kbra.com):

Flagship Credit Acceptance Issues $263.1 Million ABS

Flagship Credit Acceptance issued its fourth securitization of 2017, this time to the tune of $263.1 million, according to a pre-sale report by Kroll Bond Rating Agency.

Overall, the transaction is Flagship’s 21st securitization in its seven-year history. The ABS is also the 10th transaction that includes loans originated by both Flagship Credit Acceptance and CarFinance Capital LLC.

The average Fico in the pool is 593, the lowest of the four securitizations so far this year (which ranged from 594 to 597). The weighted average original loan term is 71 months, with an average loan balance of $20,556. Additionally, the pool consists of 34.3% new vehicles and 65.7% used.

Additionally, Chadds Ford, Pa.-based Flagship started to test out originating a small portion thin-file loans again — but to lower-risk borrowers this time — after the company halted those originations as one part of its strategy to lower losses, according to a pre-sale report. However, the thin-file loans make up less than 1% of originations, the company told Auto Finance News.

Flagship experienced an increase in losses in 2015 and 2016, due — in part — to an increase in full balance charge-offs related to an increase in skip accounts, according to the report.

In response to the increase in losses, Flagship made several changes to its underwriting including increased pricing on loans originated, reduced originations in the lowest quality indirect and direct tiers, and discontinued the military lending program. As a result, the company has experienced lower originations throughout 2017 compared to 2016.

Flagship maintains a separate loan origination system for its direct program. Direct loans are originated through CarFinance.com made via direct marketing to consumers and web aggregators, with 16% of loans representing new purchases and 84% representing refinancings as of Sept. 30.

KBRA Assigns Preliminary Ratings to Notes Issued by Flagship Credit Auto Trust 2017-4

Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to five classes of notes issued by Flagship Credit Auto Trust 2017-4 (FCAT 2017-4), an auto loan ABS transaction.

FCAT 2017-4 is collateralized by approximately $218.1 million of subprime auto loan receivables as of October 31, 2017 out of an expected collateral balance of approximately $272.6 million after completion of the prefunding period. The transaction includes a prefunding feature that allows up to 20% of the collateral pool to be funded after closing. The prefunding period is two months but the prefunding is expected to be completed by the end of 2017 based on current origination volume. The preliminary ratings reflect the initial credit enhancement levels of 42.00% for the Class A notes, 31.75% for the Class B notes, 20.25% for the Class C notes, 11.00% for the Class D notes, and 5.50% for the Class E notes. Credit enhancement consists of overcollateralization, subordination of junior notes, cash reserves and excess spread. This transaction is Flagship’s fourth securitization in 2017 and its twenty first securitization overall.

This transaction includes loans originated from both the Flagship Credit Acceptance (FCA) and CarFinance Capital LLC (CarFinance) branded origination channels. On January 1, 2015, Perella Weinberg Partners’ Asset Based Value Strategy (PWP) closed a merger of its two auto loan platforms, FCA and CarFinance. FCA’s management team, led by Mike Ritter, has combined the FCA and CarFinance operations over the past two years following the merger.

KBRA applied its Auto Loan ABS methodology as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure and Flagship’s historical static pool data. KBRA also conducted an operational assessment on the originator and servicer, as well as a review of the transaction’s legal structure and transaction documents. KBRA will also review the operative agreements and legal opinions for the transaction prior to closing.

For complete details on the analysis, please see KBRA’s Pre-Sale Report, Flagship Credit Auto Trust 2017-4 Pre-Sale Report, which was published today at www.kbra.com.

Preliminary Ratings Assigned: Flagship Credit Auto Trust 2017-4

ClassPreliminary RatingExpected Initial Principal Balance
AAAA (sf)$163,570,000
BAA (sf)$27,940,000
CA (sf)$31,360,000
DBBB (sf)$25,210,000
EBB (sf)$15,000,000

Representations & Warranties Disclosure

All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report entitled Flagship Credit Auto Trust 2017-4 Representations and Warranties Disclosure.

Related Publications (available at www.kbra.com):

Speedpay® Named Exclusive Payments Provider for Flagship Credit Acceptance

Speedpay, Inc., a Western Union® company, announced its renewed relationship with Flagship Credit Acceptance, a leading auto-finance provider with a nationwide network of more than 9,400 dealers. As part of its five-year deal, which positions Speedpay as Flagship’s electronic billing presentment and exclusive payments provider, Flagship will be Speedpay’s first auto finance client to offer the moBills® solution through Walletron.

“Our commitment to Speedpay is a testament to the confidence we have in their array of solutions – namely, their mobile payment options – that will help make it easier for our customers to pay their bills on time,” said David Bertoncini, Chief Operating Officer at Flagship Credit Acceptance. “Aligning with Speedpay means we will have greater efficiency in billing, access to top-notch customer service, and a reliable stream of payments.”

As part of its agreement with Speedpay to implement Walletron moBills®, Flagship will provide customers with the option to view their statement or pay their bill from within their smartphones’ mobile wallets. Users will receive light-up phone notifications reminding them to make or schedule a payment before a bill is due, and those who make automatic payments can also receive smartphone notifications confirming their payment has been made. The customer’s Flagship bill will update automatically in their mobile wallet, providing accurate account information in a centralized place on their phone.

“The moBills® solution enables Flagship to offer their customers a convenient, mobile-centric view into their account that complements their lifestyles. No more remembering their account numbers or log-in information before being able to make a payment – essential functions given the on-the-go demands of today’s consumers,” said Frank Lockridge, Head of Speedpay. “It’s one of the many options we offer our clients to help them reach their customers in the right place, at the right time, to facilitate timely payments.”

As a subsidiary of The Western Union Company, a leader in global payment services, Speedpay offers clients billing and payments solutions through various channels and across multiple industries, helping reduce costs, increase efficiency and improve customer satisfaction. Speedpay services also maintain an average of 99.98 percent uptime and offer 24/7 support, 365 days a year.

To learn more about Speedpay’s comprehensive electronic bill payment and presentment solutions, visit speedpay.com.

About Speedpay, Inc.

Speedpay provides electronic bill presentment and payment (EBPP) solutions that help keep your business running. An industry leader given its footprint, financial strength, service reliability and availability, Speedpay is dedicated to helping billers collect better payments. Our clients benefit from our highly consultative approach – ensuring we deliver customized payments offerings that address your business challenges and provide overall efficiency, ultimately saving you time and money. From web to mobile, eBill, IVR or CSR, Speedpay offers some of the most highly configurable channels available on the market, specifically designed for the way people want to pay bills.

A wholly owned subsidiary of E-Commerce Group Products, Inc., Speedpay has been at the forefront of the electronic payments industry since 1989, and was acquired by Western Union® in 2002.

For more information, visit www.speedpay.com.