Credit Acceptance Announces Extension of Revolving Secured Warehouse Facility

Rhea-AI Summary

Credit Acceptance Corporation (Nasdaq: CACC) has announced the extension of its $300.0 million revolving secured warehouse facility. The facility's revolving period has been extended from December 29, 2026, to July 30, 2028. Additionally, the interest rate on borrowings has been reduced from SOFR plus 221.4 basis points to SOFR plus 205 basis points, representing a decrease of 16.4 basis points.

The company, which specializes in providing vehicle financing solutions through a nationwide network of automobile dealers, currently maintains a zero balance on this facility. Credit Acceptance enables vehicle purchases for consumers regardless of their credit history, while helping them improve their credit scores through reporting to national credit agencies.

Positive

• Extension of revolving facility period by 19 months to July 2028
• Reduction in borrowing costs by 16.4 basis points
• Zero outstanding balance on the $300M facility indicating strong liquidity

Negative

• None.

Insights

Financial Analyst

CACC secured favorable extension of $300M credit facility with improved terms, enhancing financial flexibility through 2028.

Credit Acceptance Corporation has successfully extended its $300 million revolving secured warehouse facility by approximately 19 months, from December 2026 to July 2028. This extension comes with a meaningful reduction in borrowing costs, with the interest rate decreasing from SOFR plus 221.4 basis points to SOFR plus 205 basis points—a 16.4 basis point improvement.

The timing of this extension is strategically sound, as the company has secured these improved terms well ahead of the previous expiration date. This proactive approach to liability management demonstrates prudent financial planning. While the facility currently has no outstanding balance, its availability provides CACC with substantial liquidity optionality and operational flexibility.

For a specialty finance company like Credit Acceptance, which focuses on subprime auto loans, maintaining diverse and cost-effective funding sources is crucial. The improved rate terms will directly enhance potential profit margins if the facility is utilized, particularly important in the current interest rate environment. The 16.4 basis point reduction may seem modest in absolute terms, but on a $300 million facility, this represents potential annual interest savings of approximately $492,000 if fully drawn.

This facility extension reinforces CACC's financial foundation, supporting its business model of providing financing solutions to consumers with limited credit options. The lower borrowing costs and extended timeframe provide greater certainty for medium-term business planning and capital allocation decisions through mid-2028.

Southfield, Michigan, July 30, 2025 (GLOBE NEWSWIRE) -- Credit Acceptance Corporation (Nasdaq: CACC) (referred to as the “Company”, “Credit Acceptance”, “we”, “our”, or “us”) announced today that we extended the date on which our $300.0 million revolving secured warehouse facility will cease to revolve from December 29, 2026 to July 30, 2028. The interest rate on borrowings under the facility has been decreased from the Secured Overnight Financing Rate (“SOFR”) plus 221.4 basis points to SOFR plus 205 basis points. There were no other material changes to the terms of the facility.

As of July 30, 2025, we did not have a balance outstanding under the facility.

Description of Credit Acceptance Corporation

We make vehicle ownership possible by providing innovative financing solutions that enable automobile dealers to sell vehicles to consumers regardless of their credit history. Our financing programs are offered through a nationwide network of automobile dealers who benefit from sales of vehicles to consumers who otherwise could not obtain financing; from repeat and referral sales generated by these same customers; and from sales to customers responding to advertisements for our financing programs, but who actually end up qualifying for traditional financing.

Without our financing programs, consumers are often unable to purchase vehicles or they purchase unreliable ones. Further, as we report to the three national credit reporting agencies, an important ancillary benefit of our programs is that we provide consumers with an opportunity to improve their lives by improving their credit score and move on to more traditional sources of financing. Credit Acceptance is publicly traded on the Nasdaq Stock Market under the symbol CACC. For more information, visit creditacceptance.com.

Investor Relations: Jay Brinkley
Senior Vice President & Treasurer
(248) 353-2700 Ext. 6739
IR@creditacceptance.com

FAQ

What changes did Credit Acceptance (CACC) make to its revolving secured warehouse facility?

Credit Acceptance extended the facility's revolving period to July 30, 2028 and reduced the interest rate to SOFR plus 205 basis points, a decrease of 16.4 basis points.

What is the current size of CACC's revolving secured warehouse facility?

The revolving secured warehouse facility has a size of $300.0 million.

What is the current outstanding balance on Credit Acceptance's warehouse facility?

As of July 30, 2025, Credit Acceptance had no balance outstanding under the facility.

How does Credit Acceptance (CACC) help consumers with vehicle financing?

Credit Acceptance provides financing solutions that enable automobile dealers to sell vehicles to consumers regardless of their credit history, while helping them improve their credit scores through reporting to national credit agencies.