Revenue from a pool of subprime auto loans on new and used vehicles and motorcycles will collateralize $756.3 million in asset-backed bonds, in a deal coming to market from sponsor American Credit Acceptance.
The senior A tranche will issue the bulk of notes, with $364 million, and has a legal final maturity date of June 10, 2030, say analysts at S&P Global Ratings and Kroll Bond Rating Agency.
Issuing fixed-rate notes, the rest of American Credit Acceptance Receivables Trust, series 2026-3 has maturities of March 10, 2031, Jan. 10, 2033, March 8, 2033 and June 8, 2034 on classes B, C, D and E, respectively.
Under a moderate stress scenario, S&P sets a loss level at 1.37x.
KBRA, meanwhile, says it expects a cumulative net loss of 26.10%, compared with an expectation of 26.50% from S&P.
Also, the classes A, B, C, D and E provide total initial hard credit enhancement support levels of 59.85%, 52.60%, 36.00%, 22.40% and 15.50%, respectively, with classes A and B unchanged compared with the ACAR 2026-2 transaction.
The deal will repay noteholders sequentially. Otherwise in the deal structure, S&P found that the initial overcollateralization level was 14.50%, an increase from 14.00%. Target overcollateralization, meanwhile, increased to 18.75, compared with 16.50% on the previous deal.
Also, the deal benefits from a cash reserve account, funded at closing, which will equal 1.00% of the sum of the initial pool balance as of the cutoff date, and the balance of loans added during the prefunding period.
American Credit Acceptance originates loans through two marketing platforms, Tier 1, which purchases loans from CarMax and Tier 2, which purchases contracts from automotive dealership groups, franchised automobile and motorcycle dealers and from independent automobile dealerships, KBRA said.
S&P notes that loans from the tier 1 channel accounted for 34.0% of the pool, a decrease from 50.0% on the ACAR 2026-2.
KBRA assigns AAA, AA, A and BBB to classes A, B,C and D, respectively. S&P meanwhile, assigns AAA, AA, A, BBB and BB- to classes A, B, C, D and E, respectively.
