Kroll Bond Rating Agency Assigns Preliminary Ratings to American Credit Acceptance Receivables Trust 2016-3

NEW YORK--()--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to four classes of American Credit Acceptance Receivables Trust 2016-3 (“ACAR 2016-3”), an auto loan ABS transaction.

America Credit Acceptance Receivables Trust 2016-3 (“ACAR 2016-3” or the “Issuer”) will issue four classes of notes totaling $230.20 million that are collateralized by a pool of retail automobile contracts, made to subprime obligors and secured by new and used automobiles and motorcycles.

The structure for ACAR 2016-3 includes a prefunding account that will be used to purchase up to 22% of the initial cutoff date pool balance and expected balance of the subsequent receivables for up to 3 months after closing. The transaction has initial credit enhancement levels of 52.25% for the Class A Notes, 36.50% for the Class B Notes, 23.00% for the Class C Notes and 16.00% for the Class D Notes. Credit enhancement consists of excess spread, overcollateralization, subordination and a reserve account funded at closing.

American Credit Acceptance, LLC (“ACA” or the “Company”) issued its first securitization in October 2011 and since then has issued fourteen additional transactions in the total amount of approximately $2.9 billion. ACA is a subprime auto finance company that has been under current ownership since 2007.

KBRA applied its U.S. Auto Loan ABS methodology as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure and ACA’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, American Credit Acceptance Receivables Trust 2016-3 Pre-Sale Report, which was published today at

Preliminary Ratings Assigned: American Credit Acceptance Receivables Trust 2016-3

Class         Preliminary Rating       Expected Initial Principal Balance
A         AA(sf)       $132,596,000
B         A(sf)       $42,404,000
C         BBB(sf)       $36,346,000
D         BB(sf)       $18,850,000

Related Publications:

U.S. Auto Loan ABS Rating Methodology

About Kroll Bond Rating Agency

KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (NRSRO). In addition, KBRA is recognized by the National Association of Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).


Kroll Bond Rating Agency
Eric Neglia, Senior Director, (646) 731-2456
David Shin, Associate, (646) 731-2459
Rosemary Kelley, Managing Director, (646) 731-2337
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