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): June 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 June 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 June 21, 1998.
National Auto Finance 1998-1 TrustMonthly Servicer Certificate
Monthly Servicer Certificate
21-Jun-98
Pre- Pre-
Collect Funding Funding Spread Revolv Cert Trans- Master
Acct Acct Res Acct Acct Acct Acct feror Servicer
1 0 0 0 4681319 0 0 0 0
2 0 0 20823 0
3
4 3294028
5 0
6 15652
7 0 0
8 -10766 10766
9 0 0
10 -15652 -20823 36475
11 -2149656 0 2149656
12 0
13
14 -1133606 1133606
15 0 0
16 0 0
17 0 0
18 0
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 4681319 0 3283263 47241 0
33 3283263
1 Beginning Account Balances
2 Interest Income
3 Collection Account
4 Lockbox Collections during the Collections Period
5 Add: Retransfer Amt recv'd in respect of any Retransferred Contracts
6 Add: Any income and gain from investments of funds in the Collection Account
7 Add: Amts recv'd from the Transferor, the Master Servicer or any 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: Amounts received from the Transferor
16 Add: Amounts received from the Master Servicer or Subservicer
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: Pmts to the Transferor w/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
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-98
Cert
Acct Pmt
Available Amount 3283263
Payments on Payment Date
(i) Servicing Fee -143696 143696
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-Closing Travel Expenses
Invoice# 40-109088
(iiia) Class A Interest -384445 384445
(iiib) Class A Principal -1969574 1969574
(iv) Certificate Insurer -22309 22309
Financial Security Assurance
Morgan Guaranty Trust
Acct #000-33-345 ABA 021-000-238
(v) Collateral Agent (Spread Account) 0 0
Harris Trust and Savings Bank
(va) Cross Collateralization To 96-1 -763238 763238
(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 May 31, 1998.
NATIONAL AUTO FINANCE COMPANY, INC.
as Master Servicer
Melissa Grimm 25-Jun-98
Vice President, Controller
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-98
1 Month 2 Month
(A) Portfolio Performance Tests: Current: Previous Previous
(yes/no) (yes/no) (yes/no)
Trigger Event (Yes/No) no no no
Monthly
Delinquencies Delinquency
Delinquencies ACPB Ratio
2 Months Prior: 4540878 88288291 5.143%
1 Month Prior: 5457101 86217769 6.329%
Current: 6037234 84053402 7.183%
6.218%
Maximum Delinquency Ratio 8.25%
Monthly Annual
Gross Defaulted Contracts Default Default
Defaults ACPB Rate Rate
2 Months Prior: 909293 80188061 1.134% 13.607%
1 Month Prior: 695619 87253030 0.797% 9.567%
Current: 1101419 85135586 1.294% 15.525%
1.075% 12.900%
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: 54045 80188061 0.067% 0.809%
1 Month Prior: 195024 87253030 0.224% 2.682%
Current: 280640 85135586 0.330% 3.956%
0.207% 2.482%
Maximum Annualized Net Loss Rate
(i) Month 1 through 24 8.00%
(iii) Month 25 through the remainder of the transaction 6.00%
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-98
1 Month 2 Month
(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: 4540878 88288291 5.143%
1 Month Prior: 5457101 86217769 6.329%
Current: 6037234 84053402 7.183%
6.218%
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: 909293 80188061 1.134% 13.607%
1 Month Prior: 695619 87253030 0.797% 9.567%
Current: 1101419 85135586 1.294% 15.525%
1.075% 12.900%
Maximum Annualized Default Ratio
(i) Month 1 through 24 25.00%
(iii) Month 25 through the remainder of the transaction 17.00%
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-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: 54045 80188061 0.067% 0.809%
1 Month Prior: 195024 87253030 0.224% 2.682%
Current: 280640 85135586 0.330% 3.956%
0.207% 2.482%
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
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-98
Class A Interest Schedule
Opening Class A Principal Balance 78458170
Class A Interest Rate 5.88%
30/360*Class A Interest Rate 0.49%
Current Class A Interest Distribution 384445
Prior Class A Interest Arrearage 0
Class A Interest Due 384445
Current Class A Interest Arrearage 0
Class A Principal Schedule
Opening Class A Principal Balance 78458170
Scheduled Principal 1145973
Prepayments 591270
Liquidated Contracts 693053
Less: Overpayment of Principal -265929
2164367
Retransfers 0
2164367
Class A Share - 91% 1969574
Remaining Prefunding Account Balance 0
Principal due to Class A 1969574
Prepayment from Revolving Account 0
Prepayment From Pre-Funding Account 0
Prior Class A Arrearage 0
Class A Principal Due 1969574
Class A Principal Distribution 1969574
Current Class A Arrearage 0
Ending Class A Principal Balance after current Distribution 76488596
Servicing Fee Schedule
Beginning Collateral Balance 86217769
Annual Servicing Rate 2.00%
Prior Servicing Fee Arrearage 0
Current Servicer Fee 143696
Servicer Fee Due 143696
Servicer Fee Paid 143696
Current Servicing Fee Arrearage 0
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 76488596
Insurance Premium 0.350%
Insurance Premium Supplement 0.00%
Certificate Insurer Fee 22309
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 4681319
Less Interest Earned -20823
Opening Spread Account Balance 4681319
Required Balance Spread Account 4681319
Required Deposit to Spread Account 0
Ending Spread Account Balance 4681319
0
0
Remaining Deposit Required 0
Cap 4681319
Floor 76488596
The Floor Amount at any time will be equal to
the greater of (i) the outstanding Class A
Certificate Balance, and (ii) $100,000
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-98
Class A Certificate Factor
Current Class A Balance 76,488,596
Initial Class A Balance 85,200,000
Certificate Factor: 0.8977534750
Aggregate Contract Principal Balance 84,053,402
Class A Balance 76,488,596
Less: Prefunding Account
Receivable backed Certificates 76,488,596
A Investor Percentage 91.00%
Weighted Average Coupon 19.13%
Weighted Average Maturity 48.22
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-98
Beginning of Transaction 12/16/97
Payment Date 06/21/98
Month of Transaction 6
Period Ended 05/31/98
Collection Account
Beginning Balance 0
Collections during the Collections Period 3294028
Retransfer Amount received in respect of any Retransferred Contracts 0
Any income and gain from investments of funds in the Collect Acct 15652
Amts recv'd from the Transferor,Master Servicer or any Subservicer 0
Late Payment Fees collected with respect to the Contracts on Deposit 10766
Supplemental Servicing Fee 0
Amounts deposited with respect to Retransferred Accounts 0
Scheduled Principal 1145973
Prepayments 591270
Recoveries 412413
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
Pmts to the Master servicer of Insurance and Liquidation Proceeds 0
Pmts to Transferor w/respect to Retransferred Contracts or property 0
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
Transfers 0
Over 3.0 Million Principal
Remaining balance due to Investors 0
Interest Income 0
Pre-Funding Account
Beginning Balance 0
Interest Income 0
Remaining balance due to Investors 0
Spread Account
Beginning Balance 4681319
Interest Income 20823
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-98
Number of loans currently owned by Trust 7301
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 Month 3 Month
Current Prior Prior Prior
30+ Days Past Due 4458971 3936766 3521474 2731441
60+ Days Past Due 969767 1157762 677082 940391
90+ Days Past Due 608496 362574 342323 195109
Delinquent (30+ days past due) 6037234 5457101 4540878 3866942
Current Month Repos 726667 474957 633007 260050
New over 90 Days 374752 220662 276285 195109
Defaults 1101419 695619 909293 455159
Liquidated Contracts
Repos > 90 Days 28082 12537 2196 0
Closed Repo's 664971 404302 144709 24373
Past Due > 120 Days 0 0 0 0
Chapter 13 Bankruptcy 0 0 0 0
Net Liquidated Accounts 693053 416839 146905 24373
Recoveries - net of expenses 412413 221815 92860 25443
Net Losses 280640 195024 54045 -1070
ACPB 84053402 86217769 88288291 72087831
Principal Paid
01/21/98 570239
02/21/98 1187300
03/21/98 1351552
04/21/98 1748564
05/21/98 1884175
6741830
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Jun-98
Amount
World Omni to World Omni (Servicer) Reconciliation
Opening Principal Balance per World Omni
4/30/98 - Trailer Summary Report 85315777
Add: New Accounts Transferred 0
Less: Scheduled Principal Received -1145973
Prepaid Accounts -591270
Repossessed Accounts -726667
Total principal reductions -2463910
Subtotal 82851866
Closing Principal Balance per WO - Trailer Summary 5/31/98 82851866
Difference 0
ACPB to World Omni Reconciliation
Closing Principal Balance
per World Omni 5/31/98 82851866
Add: Non Liquidated Repo Inventory
deducted from World Omni balance but
not passed through to investors 1201536
Adjusted World Omni Principal Balance 84053402
ACPB Prior to ACPB Current Reconciliation
Prior Month ACPB 86217769
Add: New Accounts Transferred 0
Less: Scheduled Principal Received -1145973
Prepaid Accounts -591270
Plus: One time ACPB Adjustment 265929
Less: Liquidated Accounts -693053
Current Month ACPB 84053402
Adjusted World Omni Principal Balance 84053402
Current Month ACPB 84053402
Difference 0
Liquidated Repo
Repo/Liquidated Accounts Repo Prin Principal Inventory
12/31/97 2196 2196 0
01/31/98 121350 121350 0
02/28/98 260050 260050 0
03/31/98 752214 640263 111951
04/30/98 620229 257311 362918
05/31/98 726667 0 726667
2482707 1281171 1201536
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: May 31, 1998
