Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to five classes of notes issued by Avant Loans Funding Trust 2021-REV1 ("AVNT 2021-REV1"), a $200 million consumer loan asset backed security transaction. The preliminary ratings reflect initial credit enhancement level ranging from 46.56% to 1.50% for the Class A through E Notes. Credit enhancement consists of overcollateralization, subordination in the case of the Class A, Class B, Class C and Class D Notes and a reserve account funded at closing.
This transaction represents Avant, LLC’s ("Avant", the "Servicer" or the "Company") eleventh rated securitization collateralized by a trust certificate backed by unsecured consumer loans originated through its online marketplace lending platform ("Avant Platform"). Founded in 2012, Avant is located in Chicago, Illinois and operates an online lending platform. Personal installment loans are offered primarily to non-prime consumers through the Avant Platform. Typical customers have FICO scores between 550 and 720. Loans have an original term of between 24 – 60 months, an original balance between $2,000 to $35,000 and a fixed APR between 9.95% - 35.95% depending on the borrower’s risk profile and loan term. The Avant Platform charges an administration fee to borrowers ranging from 1.50% to 4.75%. The primary purposes for the loans are for debt consolidation, emergency expense, life event, or car repair. In 2020, $458 million was originated through the Avant Platform, down from $1.1 billion (-59%) in 2019. As of December 31, 2020, approximately $7.0 billion in loans had been originated through the Avant Platform in the U.S.
Avant has issued three securitizations in 2016, two in 2017, two in 2018, two in 2019, and one in 2020. Each of the ten securitizations were rated by KBRA. There have also been four prior unrated securitizations, in which Avant or Avant’s institutional investors were the sponsors and the collateral was unsecured consumer loans originated through the Avant Platform.
Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.
A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.
Information on the meaning of each rating category can be located here.
Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.
Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority pursuant to the Temporary Registration Regime. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.
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