November 15 2017 | Chadds Ford, PA
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.
Flagship Credit Acceptance LLC ("Flagship"), headquartered in Chadds Ford, Pennsylvania with offices in Irving, Texas, Phoenix, Arizona, Irvine, California and Indianapolis, Indiana, helps credit-challenged auto shoppers secure financing through partnerships with primarily franchised auto dealers and through its direct lending site, CarFinance.com. Flagship Credit has successfully grown its portfolio to $2.9 billion in managed receivables. The Company currently purchases indirect auto contracts from a nationwide network of over 9,400 dealers and originates direct to consumers in 46 states.
Flagship Credit Acceptance, LLC ("Flagship") is committed to maintaining a culture of fair credit throughout the organization. In this regard, Flagship has developed a Fair Credit Program ("Program") that complies with all applicable fair credit laws and regulations ("FC Laws") and reflects industry best practices. Flagship is committed to comply with the letter and spirit of FC Laws. The goal of the Program is to carry out Flagship's commitment and be recognized internally and externally (e.g., by management, associates, customers, service providers, and the public) as dedicated to fair credit principles and demanding of compliance. The Program applies to all aspects of Flagship's operations (including reviewing, purchasing and servicing retail installment sale contracts whether for itself or others) and all services offered by Flagship, and across all of Flagship's credit operations, including marketing, underwriting, origination, processing, servicing, collection, loss mitigation, and payoff activities, and to all personnel who work for or on behalf of Flagship, whether as associates, officers, members of the Board of Directors, agents, representatives or service providers.
Should you have any questions about the details of any of Flagship's policies, please contact us at 1.800.900.5150 M-F, between 9:00 a.m. and 5:00 p.m. EST.×
A borrower is more than just a credit score. At Flagship, we focus on the story behind the customer …and look beyond the number.
Life happens. Whether low credit scores are a result of past circumstances, one-time events or just bad luck, Flagship offers multi-tiered pricing structures to finance borrowers across the credit spectrum.
At Flagship we believe a borrower’s credit past shouldn’t dictate their future.
Many borrowers need a second chance. We recognize the vast majority of persons with credit challenges are working hard to re-establish their credit rating. Each of our Credit Analysts are trained in "common sense" lending, a philosophy of reviewing all the circumstances and determining the appropriate deal structure for the specific borrower situation. Flagship maintains a very high standard regarding Fair Lending compliance, ensuring our customers are always treated professionally and consistently.×