A risk management program applied by lenders on C & D tier loans. LOC purchases vehicles from lenders at pre-stated values that are higher than auctions or bids and provides a principal balance reduction payment to further reduce deficiency balances.
LOC Protection enables lenders to increase loan volume and finance income, and to improve the yield and profitability on auto loan portfolios by reducing losses from repossessed vehicles.
Borrowers qualify for a lower interest rate, establish credit or improve existing credit, and benefit from reduced deficiency balances from repossessed vehicles.
The program enables lenders to increase loan volume and finance income with a significant reduction of deficiency loan balances.