SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): September 21, 1998
NATIONAL FINANCIAL AUTO FUNDING TRUST
(Exact name of registrant as specified in its charter)
333-44159
Delaware 333-28829 not applicable
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
One Park Place
621 N.W. 53rd Street
Boca Raton, FL 33487
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (800) 999-7535
Item 5. Other Events
On January 20, 1998 (the Closing Date), National Auto Finance 1998-1 Trust, a
Delaware business trust formed by National Financial Auto Funding Trust (the
Registrant) issued $85,200,000 aggregate principal amount of Notes designated
the National Auto Finance 1998-1 Trust 5.88% Automobile Receivables-Backed
Notes, Series 1998-1 (the Notes), pursuant to an Indenture, dated as of
December 15, 1997, between the 98-1 Trust and Harris Trust and Savings Bank,
as Trustee and Trust Collateral Agent. The Notes are secured by trust property
consisting primarily of a segregated pool (the Receivables Pool) of non-prime
motor vehicle retail installment sale contracts (the Receivables), all of which
are secured by new or used automobiles, light-duty trucks, vans, or minivans
financed thereby. The Receivables Pool consisted as of the Closing Date of
Receivables having an aggregate principal balance as of December 15, 1997 (the
Cut-off Date) of approximately $75,504,414.69. The 98-1 Trust may acquire
certain additional Receivables on or prior to April 30, 1998 with funds
deposited in a Pre-Funding Account in the amount of approximately
$16,490,982.64, which additional Receivables will also secure the Notes. As
of the Cut-off Date, the Receivables had the characteristics described in the
Prospectus dated January 15, 1998 filed with the Commission pursuant to Rule
424(b)(2) of the Securities Act of 1933, as amended. This Current Report
on Form 8-K is being filed to satisfy certain reporting requirements.
A. Monthly Report Information:
Aggregate distribution information for the current
distribution date September 21, 1998.
Principal Interest Ending Balance
See Exhibit 1.
B. No delinquency in payment under the Certificate Guaranty
Insurance Policy has occurred.
C. Have any deficiencies occurred? NO.
Date:
Amount:
D. Were any amounts paid or are any amounts payable under
the Certificate Guaranty Insurance Policy? NO
Amount:
E. Are there any developments with respect to the Certificate
Insurance Guaranty Policy? NONE.
F. Item 1: Legal Proceedings: NONE
G. Item 2: Changes in Securities: NONE
H Item 4: Submission of Matters to a Vote of
Certificatholders: NONE
I. Item 5: Other Information - Form 10-Q, Part II - Items
1,2,4,5 if applicable: NOT APPLICABLE
Item 7. Monthly Statements and Exhibits
Exhibit No.
1. Monthly Servicer Certificate dated September 21, 1998.
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98 Pre-
Pre- Funding
Collect Funding Reserve Spread Revolving Cert Trans- Master
Acct Acct Acct Acct Acct Acct feror Servicer
1 0 0 0 5076403 0 0 0 0
2 0 0 21531 0
3
4 2695294
5 0
6 19855
7 0 0
8 -6450 6450
9 0 0
10 -19855 -21531 41386
11 -1623478 0 1623478
12 0
13
14 -1065366 1065366
15 0 0
16 0
17 0 0
18 367284
19 0 0 0
20 0 0
21 0
22 0 0 0 0
23 0
24 0 0 0 0
25 0 0
26 0
27 0 0
28 0 0
29
30 0
31 0
32 -0 0 0 5443688 0 2688844 47837 0
33 2688844
1 Beginning Account Balances
2 Interest Income
3 Collection Account
4 Lockbox Collections during the Collections Period
5 Add: Retransfer Amount received in respect of any Retransferred Contracts
6 Add: Any income and gain from investments of funds in the Collection Account
7 Add: Amts received from the Transferor, Master Servicer or Subservicer
8 Less: Late Payment fees collected with respect to the Contracts on Deposit
9 Less: Supplemental Servicing Fee
10 Less: Any income and gain on investments of deposits in Collection Account
11 Less: Scheduled & Prepay Contract Principal
12 Less: Amounts deposited with respect to Retransferred Contracts
13 Certificate Account
14 Add: Withdrawals from Collection Account
15 Add: Payback from 96-1 Trust
16 Add: Payback from 97-1 Trust
17 Add: Withdrawals from Revolving Account
18 Add: Amounts deposited with respect to the spread requirements
19 Add: Withdrawals from the Pre-Funding Reserve Account
20 Add: Withdrawals from the Spread Account
21 Add: Proceeds of any Contracts or Property
22 Add: Any income and gain on investments of funds in the Certificate Account
23 Add: Amounts received from Certificate Insurer
24 Add: Withdrawals from the Revolving Account or Pre-Funding Account
25 Add: Amount Due to Class A Investors
26 Less: Expenses of Master Servicer or Transferor
27 Less: Payments to the Master servicer of Insurance and Liquidation Proceeds
28 Less: Payments to the Transferor with respect to
Retransferred Contracts or property
29 Pre-Funding Reserve Account
30 Less: Amount in excess of Required Deposit
31 Less: Amounts Distributed
32 Ending Account Balances
33 Available Amount to Certificate Holders
1
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
Cert
Account Payment
Available Amount 2688844
Payments on Payment Date
(i) Servicing Fee -133033 133033
NAFI Operating Depository Account
First Union National Bank, Charlotte, NC
Acct #2010000259454 - ABA 053000219
(ii) Trustee, Collateral Agent 0 0
and Custodian fees
Harris Bank
(iiia)Class A Interest -355916 355916
(iiib)Class A Principal -1811954 1811954
(iv) Certificate Insurer -20657 20657
Financial Security Assurance
Morgan Guaranty Trust
Acct #000-33-345 ABA 021-000-238
(v) Collateral Agent (Spread Account) -367284 367284
Harris Trust and Savings Bank
(va) Cross Collateralization To 96-1 0 0
(vi) [Reserved]
(vii) Unreimbursed expenses to the Trustee 0 0
(viii)Unreimbursed expenses to the Master Servicer 0 0
(ix) Unreimbursed expenses to the Standby Servicer 0 0
(x) Unreimbursed expenses to the Transferor 0 0
(xi) Class B Certificate Holders 0 0
National Auto Finance Company, Inc.
First Union National Bank
Acct #2010000259454 - ABA 053000219
Pursuant to section 3.17 of the Pooling and Servicing Agreement dated as of
January 15, 1998 among National Financial Auto Funding Trust, National Auto
Finance Company, Inc. and Harris Trust and Savings Bank, the undersigned, as
the Master Servicer, is providing the attached Monthly Statement
for the Collection Period 31-Aug-98
NATIONAL AUTO FINANCE COMPANY, INC.
as Master Servicer
Kevin Adams 07-Oct-98
Sr. Vice President
2
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
1 Month 2 Months
(A) Portfolio Performance Tests: Current: Previous Previous
(yes/no) (yes/no) (yes/no)
Trigger Event (Yes/No) yes yes no
Monthly
Delinquencies Delinquency
Delinquencies ACPB Ratio
2 Months Prior: 7020699 82421954 8.518%
1 Month Prior: 8436646 79819637 10.570%
Current: 7327948 77828478 9.416%
9.501%
Maximum Delinquency Ratio 8.25%
Monthly Annual
Gross Defaulted Contracts Default Default
Defaults ACPB Rate Rate
2 Months Prior: 1267550 83237678 1.523% 18.274%
1 Month Prior: 806056 81120795 0.994% 11.924%
Current: 1191408 78824058 1.511% 18.138%
1.343% 16.112%
Maximum Annualized Default Ratio
(i) Month 1 through 24 18.00%
(iii) Month 25 through the remainder of the transaction 14.00%
Monthly Annual
Losses Loss Loss
Losses ACPB Rate Rate
2 Months Prior: 230008 83237678 0.276% 3.316%
1 Month Prior: 558390 81120795 0.688% 8.260%
Current: 367680 78824058 0.466% 5.597%
0.477% 5.725%
Maximum Annualized Net Loss Rate
(i) Month 1 through 24 8.00%
(iii) Month 25 through the remainder of the transaction 6.00%
3
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
1 Month 2 Months
(B) Insurance Agreement Event of Defaults Previous Previous
Current: (yes/no) (yes/no)
Event of Default (Yes/No) no no no
(1) Bankruptcy or insolvency of the Company, or the Seller;
(2) A default or a breach of a representation, warranty, or
covenant by the Company or the Seller under any of the
transaction documents which has not been cured
within the applicable grace period;
(3) Any claim for payment under the Certificate Policy;
(4) Delinquency Ratio is 11% or higher averaged
over the 3 previous Monthly Periods:
Monthly
Delinquencies Delinquency
Delinquencies ACPB Ratio
2 Months Prior: 7020699 82421954 8.518%
1 Month Prior: 8436646 79819637 10.570%
Current: 7327948 77828478 9.416%
9.501%
Maximum Delinquency Ratio 11.00%
(5) The Default Rate average over the 3 previous Monthly
Periods exceeds 25% for month 1 through 24,
and 17% for the remainder of the transaction;
Monthly Annual
Defaults Default Default
Defaults ACPB Rate Rate
2 Months Prior: 1267550 83237678 1.523% 18.274%
1 Month Prior: 806056 81120795 0.994% 11.924%
Current: 1191408 78824058 1.511% 18.138%
1.343% 16.112%
Maximum Annualized Default Ratio
(i) Month 1 through 24 25.00%
(iii) Month 25 through the remainder of the transaction 17.00%
4
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
(B) Insurance Agreement Event of defaults (Cont.)
(6) The Net Loss Rate averaged over the 3 previous Monthly
Periods exceeds 11% for month 1 through 24,
and 8% for the remainder of the transaction;
Monthly Annual
Losses Loss Loss
Losses ACPB Rate Rate
2 Months Prior: 230008 83237678 0.276% 3.316%
1 Month Prior: 558390 81120795 0.688% 8.260%
Current: 367680 78824058 0.466% 5.597%
0.477% 5.725%
Maximum Annualized Net Loss Rate
(i) Month 1 through 24 11.00%
(iii) Month 25 through the remainder of the transaction 8.00%
(7) The Servicer Termination Events listed below:
(i) Failure to deposit funds as required under the no
Pooling and Servicing Agreement
(ii) Failure to deliver the Servicer's Certificate no
(iii) Breach of Servicer covenants no
(iv) Bankruptcy or insolvency of the Servicer no
(v) Material breach of representations and warranties no
(vi) Certificate Insurer has not delivered a no
Servicer Extension Notice
(vii) Insurance Agreement Event of Default on no
this or other transactions
(viii)Claim under the policy no
5
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
Class A Interest Schedule
Opening Class A Principal Balance 72635870
Class A Interest Rate 5.88%
30/360*Class A Interest Rate 0.49%
Current Class A Interest Distribution 355916
Prior Class A Interest Arrearage 0
Class A Interest Due 355916
Current Class A Interest Arrearage 0
Class A Principal Schedule
Opening Class A Principal Balance 72635870
Scheduled Principal 923408
Prepayments 464584
Liquidated Contracts 603166
Less: Principal write-up adjustment
1991158
Retransfers 0.00
1991158
Class A Share - 91% 1811954
Remaining Prefunding Account Balance 0
Principal due to Class A 1811954
Prepayment from Revolving Account 0
Prepayment From Pre-Funding Account 0
Prior Class A Arrearage 0
Class A Principal Due 1811954
Class A Principal Distribution 1811954
Current Class A Arrearage 0
Ending Class A Principal Balance after current Distribution 70823915
Servicing Fee Schedule
Beginning Collateral Balance 79819637
Annual Servicing Rate 2.00%
Prior Servicing Fee Arrearage 0
Current Servicer Fee 133033
Servicer Fee Due 133033
Servicer Fee Paid 133033
Current Servicing Fee Arrearage 0
6
National Auto Finance 1998-1 Trust
National Auto Finance Company, Inc.
Monthly Servicer Certificate
SEC Reporting and Trustee Fee Schedule
Sec Reporting Fee 0
Closing Expenses 0
Prior Trustee Fee Arrearage 0
Current SEC and Trustee Fee 0
Trustee Fee Due 0
Current Trustee Fee Arrearage 0
Certificate Insurer Schedule
Ending Class A Balance 70823915
Insurance Premium 0.350%
Insurance Premium Supplement 0.00%
Certificate Insurer Fee 20657
Pre-Funding Account
Opening Balance 0
Monthly Originations X 91% 0
Withdrawal From Pre-Funding Account 0
Prepayment associated with end of Pre-Funding Period 0
Due to Class A Investors 0
Closing Balance 0
Revolving Account Schedule
Opening Balance 0
Amount Transferred from Collection Account 0
First Interim Balance 0
Withdrawal From Revolving Account 0
Second Interim Balance 0
Amount Transferred to Certificate Account
Prepayment Associated with Release from Revolving Account 0
Ending Balance 0
Spread Account
Initial Collateral Balance 85200000
Opening Spread Account Balance 5076403
Less Interest Earned -21531
Opening Spread Account Balance 5076403
Required Balance Spread Account 7004563
Required Deposit to Spread Account 1928160
Ending Spread Account Balance 5443688
Remaining Deposit Required 1560876
Cap 7004563
Floor 70823915
The Floor Amount at any time will be equal to
the greater of (i) the outstanding Class A
Certificate Balance, and (ii) $100,000
7
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
Class A Certificate Factor
Current Class A Balance 70823915
Initial Class A Balance 85200000
Certificate Factor: 0.8312666126
Aggregate Contract Principal Balance 77828478
Class A Balance 70823915
Less: Prefunding Account 0
Receivable backed Certificates 70823915
A Investor Percentage 91.00%
Weighted Average Coupon 19.09%
Weighted Average Maturity 45.60
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
Beginning of Transaction 12/16/97
Payment Date 09/21/98
Month of Transaction 9
Period Ended 08/31/98
Collection Account
Beginning Balance 0
Collections during the Collections Period 2695294
Retransfer Amount received in respect of any Retransferred Contracts 0
Any income and gain from investments of funds in the Collect Accnt 19855
Amounts received from the Transferor, Master Servicer or Subservicer 0
Late Payment Fees collected with respect to the Contracts on Deposit 6450
Supplemental Servicing Fee 0
Amounts deposited with respect to Retransferred Accounts 0
Scheduled Principal 923408
Prepayments 464584
Recoveries 235486
Certificate Account
Amounts received from the Transferor 0
Amounts received from the Master Servicer or Subservicer 0
Withdrawals from the Pre-Funding Reserve Account 0
Withdrawals from the Spread Account 0
Proceeds of any Contracts or Property 0
Any income and gain on investments of funds in the Certificate Acct 0
Amounts received from Certificate Insurer (Claims to FSA) 0
Expenses of an Opinion of Counsel 0
Expenses of Master Servicer or Transferor 0
Payments to the Master servicer of Insurance and Liquidation Proceeds 0
Payments to the Transferor with respect to 0
Retransferred Contracts or property
Pre-Funding Reserve Account
Beginning Balance 0
Amount in excess of Required Deposit 0
Interest Income 0
Certificate Insurer
Is there a claim on the policy in the current month, No
or has there ever been a claim?
Revolving Account
Beginning Balance 0.00
Transfers 0.00
Over 3.0 Million Principal
Remaining balance due to Investors 0.00
Interest Income 0.00
Pre-Funding Account
Beginning Balance 0.00
Interest Income 0.00
Remaining balance due to Investors 0.00
Spread Account
Beginning Balance 5076403
Interest Income 21531
9
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
Number of loans currently owned by Trust 6803
Initial Collateral Balance 85200000
New Originations Transferred to Trust 0
Initial Certificate Account Balance 0
Previous Servicing Fee Arrearage 0
Previous Trustee, Collateral Agent, 0
Lockbox and Custodian fees - Arrearage
Previous Class A Interest Arrearage 0
Unreimbursed expenses to the Trustee 0
Unreimbursed expenses to the Master Servicer 0
Unreimbursed expenses to the Standby Servicer 0
Unreimbursed expenses to the Transferor 0
Opening Class A Principal Balance 85200000
Prior Class A Principal Arrearage 0
1 Month 2 Months 3 Months
Current Prior Prior Prior
30+ Days Past Due 4882612 5875719 5225810 4458971
60+ Days Past Due 1843153 1737253 1201553 969767
90+ Days Past Due 602182 823675 593336 608496
Delinquent (30+ days past due) 7327948 8436646 7020699 6037234
Current Month Repos 596800 259555 685117 650115
New over 90 Days 594608 546501 582433 374752
Defaults 1191408 806056 1267550 1024867
Liquidated Contracts
Repos > 90 Days 399611 203006 78398 28082
Closed Repo's 203555 479268 278280 664971
Past Due > 120 Days 0 84571 89468 0
Chapter 13 Bankruptcy 0 102365 0 0
Net Liquidated Accounts 603166 869210 446145 693053
Recoveries - net of expenses 235486 310819 216138 412413
Net Losses 367680 558390 230008 280640
ACPB 77828478 79819637 82421954 84053402
7004563
Principal Paid
01/21/98 570239
02/21/98 1187300
03/21/98 1351552
04/21/98 1748564
05/21/98 1884175
06/21/98 1969574
07/21/98 1484618
08/21/98 2368108
12564130
10
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Sep-98
Amount
World Omni to World Omni ( Servicer) Reconciliation
Opening Principal Balance 77721622
Add: New Accounts Transferred 0
Less: Scheduled Principal Received -923408
Prepaid Accounts -464584
Repossessed Accounts -879954
Total principal reductions -2267946
Plus BNI Conversion Write Up
Closing Principal Balance 75453675
Closing Principal Balance per BNI 74702670
Difference 751005
ACPB Reconciliation
Closing Principal Balance 74702670
Add: Non Liquidated Repo Inventory
deducted from World Omni balance but
not passed through to investors 1488027
Adjusted Principal Balance 76190697
ACPB Prior to ACPB Current Reconciliation
Prior Month ACPB 79819637
Add: New Accounts Transferred 0
Less: Scheduled Principal Received -923408
Prepaid Accounts -464584
Less: Liquidated Accounts -603166
Plus: BNI Conversion Write Up 0
Current Month ACPB 77828478
Adjusted Principal Balance 76190697
Current Month ACPB 77828478
Difference -1637782
Repo Liquidated Repo
Repo/Liquidated Accounts Principal Principal Inventory
12/31/97 2196 2196 0
01/31/98 121350 121350 0
02/28/98 260050 260050 0
03/31/98 752214 752214 0
04/30/98 620229 620229 0
05/31/98 726667 726667 0
06/30/98 734195 417771 316425
07/31/98 321619 29971 291648
08/31/98 879954 0 879954
4418475 2930448 1488027
91% Investor Balance:
Ending Class A Balance 70823915
Current ACPB 77828478
Investor Percentage 91.00%
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FINANCIAL ASSET SECURITIES CORPORATION
/s/ Kevin Adams
VP/CFO
Dated: August 31, 1998
