Specialty Lenders
Overview
The credit facility grew from $3.5M to $25M at an 80% advance rate, fueling sustained portfolio growth. Lower borrowing costs set up a future bank refinance.
Contact
Tom Kessel
Principal
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The Situation
The company held a $3.5M line with a local bank and originated subprime automotive loans. Portfolio health and profitability were strong, but the facility had stopped scaling with the loan book.
The Constraint
Multiple banks declined the request for an increase despite the performance. Without additional credit, the company could not meet rising loan demand.
The Structure
We identified a non-bank specialty finance provider offering a $10M two-year revolving facility with an option to increase to $20M. Performance milestones then lifted the commitment and advance rates, reaching $25M at an 80% advance rate with reduced borrowing costs.
The Outcome
The facility expanded from $3.5M to $25M, supporting sustained portfolio growth and higher profitability. With improved advance rates and lower costs, the business is positioned for a future commercial-bank refinance at lower rates.
