LendingPoint Holdings is offering its first securitization on nonprime direct-to-consumer loans.
The LendingPoint 2019-1 trust will market $169.4 million in notes backed by 18,760 loans with a collective balance of $178.3 million. The average loan balance is $9,504 with an interest rate of 22.56%. The loans average 44-month original terms with 10 months of seasoning.
Borrowers have an average FICO of 668, with approximately 73% with nonprime FICO scores under 700.
The loans will back four classes of notes including a $112.15 million Class A tranche with a preliminary A- rating from Kroll Bond Rating Agency. The senior notes benefit from 37.6% credit enhancement, including an expected total gross excess spread of 16.01% between the interest collected on payments and that paid on investor notes (which have a weighted coupon of 4.3%).
Kroll has a base case cumulative net loss expectation of 12.45%-14.45%.
LendingPoint’s loans were mostly originated through a third-party Utah-chartered bank, FinWise. The remainder were issued by LendingPoint itself through state licenses in four states (Delaware, Georgia, Utah and South Dakota).
The company issues two types of loans: direct-to-consumer online loans and point-of-sale retail loans. POS loans are not included in the current transaction, however.
LendingPoint, founded in July 2014 in Kennesaw, Ga., issued its first direct loan in 2015. It has issued $1.2 billion in loans to date.
