Credit Acceptance ups credit line limit, cuts rates on warehouse loans

By Susanna Moon

Chicago, June 17 - Credit Acceptance Corp. said it amended its revolving secured line of credit facility, pushing out the maturity, and secured lower rates on its revolving secured warehouse facility.

The maturity of the facility with a commercial bank syndicate is now June 22, 2014, extended from June 22, 2012, and the facility amount was raised to $205 million from $170 million. Interest on the loans will still be Libor plus 225 basis points.

Under the new terms, there is no longer a Libor floor, which was set at 75 bps, and the company is no longer required to maintain a minimum ratio of assets to debt.

Based on current Libor rates, eliminating the floor will reduce borrowing costs under the facility by about 50 bps, according to a company press release.

The credit facility continues to be secured by a lien on most of the company's assets.

As of June 17, there was about $105.7 million outstanding under the facility.

Changes on warehouse revolver

The company also extended the date on which its $325 million revolving secured warehouse facility will cease to revolve to June 17, 2014 from June 15, 2013.

Interest under the warehouse facility was lowered to the commercial paper rate plus 275 bps from the commercial paper rate plus 350 bps. There were no other material changes to the terms of the facility.

As of June 17, there was $208.0 million outstanding under the facility.

Credit Acceptance is a Southfield, Mich.-based provider of consumer auto loans.

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