Credit Acceptance Corporation has entered into a $300 million asset-backed non-recourse secured financing, using a wholly owned special purpose entity, Credit Acceptance Funding LLC 2024-B, to pledge consumer loans valued at approximately $375.1 million. The financing includes three classes of notes with interest rates ranging from 5.79% to 6.67% and an expected average annualized cost of 6.3%. The financing will revolve for 36 months before amortizing based on cash flows from the pledged loans.

The company will use the financing proceeds to repay outstanding debt and for general corporate purposes. It will retain 4.0% of the cash flows from the pledged loans for servicing expenses, while the remaining 96.0%—less dealer holdback payments—will go toward paying principal, interest, and other costs.

The agreement includes termination provisions, allowing creditors to accelerate repayment and exercise remedies if Credit Acceptance fails to meet financial performance requirements or breaches key covenants. The transaction structure ensures that dealer relationships remain unaffected.

A press release regarding this financing was issued on December 20, 2024.