Helig-Myers furniture instalment loan securitisation

The furniture retailer offers instalment finance to customers who buy its furniture, and they pay their local store, i.e., collection is decentralised.

To increase liquidity HM securitised the account rerceivables. To compete, HM lowered its credit criteria. Higher credit quality buyers used their credit cards instead of HM's instalment plans, so those that did use the plans were poor credit quality.

When HM shut down its stores, corresponding customers defaulted on their payment plans. That affected the payments to ABS investors