CarMax Business Services is sponsoring a $600 million securitization of revenue from a pool of non-prime auto loan receivables, issuing fixed-rate notes from the CarMax Select Receivables Trust, series 2026-B.
The capital structure, which will repay seven tranches of senior and subordinate notes sequentially, will issue fixed-rate notes, according to analysts at S&P Global Ratings and Fitch Ratings.
This series of CarMax Select Receivables notes is offering 8.42% in excess spread, a reduction from 9.85% on the CMXS 2026-A notes, according to S&P. That's just one of several structural changes, as total initial hard credit enhancement increased across tranches.
Total initial hard credit enhancement is 31.75%, 25.25%, 16.25%, 8.50% and 4.50% for the class A, B, C, D and E, respectively, up from 27.15%, 21.10%, 12.55%, 5.60% and 3.50% respectively, S&P said.
The pool is composed of 31,874 loans, all on used vehicles, which have an average current principal balance of $19,507. The contracts have an original term of 70 months with 63 remaining, and a weighted average (WA) annual percentage rate of 16.3%. Also, they have a WA loan-to-value ratio of 97.7%.
Borrowers have a FICO score of 613 on a WA basis.
Electric and hybrid vehicles accounted for just 2.3% of the asset pool, and is the smallest ratio among the comparison pools, which only reached 4.3% on the AMCAR 2026-1 series of notes.
S&P assigns A1+ to the A1 notes and AAA to the A2 and A3 notes; plus AA+, A+ BBB and BB to the B, C, D and E tranches, respectively. Fitch assigns F1+ to the A1 notes; AAA to the A2 and A3 notes; and AA, A, BBB and BB to the B, C, D and E notes, respectively.
