Subordinated Debt Investment Opportunity
In 2016, SAF introduced a lower interest rate program for high-credit consumers, and in mid-2017 Summit closed a $500M 3-year asset purchase facility with major NY-based loan buyer.
The combination of the new asset purchase facility and the introduction of more competitive pricing across the credit spectrum resulted in a large increase in loan funding volume.
As a result, SAF has been raising additional “downstroke” capital in the form of subordinated debt to season new loan originations. The loan originations are seasoned in an 85% advance rate warehouse credit facility for at least one payment before the completion certificate is issued and prior to selling the loans into a $500M asset purchase facility. As such, subordinated debt investors are largely insulated from loan default risk. Additionally, all lenders to SAF’s companies and predecessors have been paid in full, even through the Great Recession.
On a first-come, first-serve basis, SAF is offering a 12% interest rate for 12 months, with interest paid monthly or quarterly. Principal will be paid back at maturity. This opportunity will be guaranteed by AmeriFirst and secured by our loan collateral, after senior warehouse lenders.