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The company has more than $400 million of outstanding ABS, and is now in talks with creditors over what happens to its remaining assets and operations.
Navient will follow a sequential repayment structure, and no subordinate classes will receive any principal until the most senior outstanding class is paid in full.
American Banker research finds that while more than 30% agree buy now/pay later is good for banks and consumers, the majority of respondents are unconvinced.
After four years, the senior note classes will either pay a 100 basis-point increase to the fixed coupon or the net weighted average coupon (WAC) rate, whichever is lower.
Credit enhancement could increase for the most senior outstanding classes of notes, however, as the notes repay investors sequentially over time.
