Que sera, sera; what will be, will be.

While it may be true, yielding to that platitude is a terrible way to create a successful future. Instead, we say, “what will be, will be what you expect…if you are prepared.”

We’re calling on market participants in all roles – originators, investors, servicers, trustees and others – to participate in our second annual 360˚ market study that will analyze industry leaders’ perceptions of where the subprime auto finance market is heading. When the results are in, participants will have a view to each other’s expectations – a way to a more certain future.

Like Ken Miles in search of the perfect lap at Le Mans, as a follow-up to our last survey, we will be further exploring the concept of C³ equilibrium – the ideal state where credit ratings, credit enhancements and credit quality work together to contribute to a securitization’s and the market’s success.

Since the study first launched, we’ve begun to see market changes in line with participants’ expectations, from credit rating downgrades to higher delinquencies occurring against the backdrop of economic uncertainty.

The current study will show, among other things, if participants’ views have now changed regarding the largest risks to performance, given that the greatest concern noted in the prior study – an economic downturn – has not materialized as many had feared, and yet delinquencies continue to climb. Specifically, we’re probing whether layered risk which comes with extended loan terms – now averaging 63 months and up to 84 months on used vehicles – may be a larger worry that should be addressed.

You can provide your input and be part of the solution at the same time. Take the three-minute survey here and you’ll receive a complimentary copy of the market study when it is published in May.

Emily Hatchett, a paralegal in the Insolvency, Creditor’s Rights and Financial Products Group, assisted with this post.