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): August 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 August 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 August 21, 1998.
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Aug-98
Pre-Fund
Collect Pre-Fund Res Spread Revolve Cert Trans- Master
Acct Acct Acct Acct Acct Acct feror Servicer
1 0 0 0 4681319 0 0 0 0
2 0 0 20937 0
3
4 3292382
5 0
6 16592
7 0 0
8 -3205 3205
9 0 0
10 -16592 -20937 37529
11 -2043926 0 2043926
12 0
13
14 -1245251 1245251
15 0 0
16 0
17 0 0
18 395085
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 5076403 0 3289177 40733 0
33 3289177
1 Beginning Account Balances
2 Interest Income
3 Collection Account
4 Lockbox Collections during the Collections Period
5 Add: Retransfer Amt received in respect of any Retransferred Contracts
6 Add: Any income and gain from investments of funds in the Collect Acct
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
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-Aug-98
Cert
Acct Payment
Available Amount 3289177
Payments on Payment Date
(i) Servicing Fee -137370 137370
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 -367429 367429
(iiib) Class A Principal -2368108 2368108
(iv) Certificate Insurer -21185 21185
Financial Security Assurance
Morgan Guaranty Trust
Acct #000-33-345 ABA 021-000-238
(v) Collateral Agent (Spread Account) -395085 395085
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-Jul-98
NATIONAL AUTO FINANCE COMPANY, INC.
as Master Servicer
Kevin Adams 31-Aug-98
Sr. Vice President
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Aug-98
1 Month 2 Months
(A) Portfolio Performance Tests: Current: Previous Previous
(yes/no) (yes/no) (yes/no)
Trigger Event (Yes/No) yes no no
Monthly
Delinquencies Delinquency
Delinquencies ACPB Ratio
2 Months Prior: 6037234 84053402 7.183%
1 Month Prior: 7020699 82421954 8.518%
Current: 8436646 79819637 10.570%
8.757%
Maximum Delinquency Ratio 8.25%
Monthly Annual
Gross Defaulted Contracts Default Default
Defaults ACPB Rate Rate
2 Months Prior: 1024867 85135586 1.204% 14.446%
1 Month Prior: 1267550 83237678 1.523% 18.274%
Current: 806056 81120795 0.994% 11.924%
1.240% 14.881%
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: 280640 85135586 0.330% 3.956%
1 Month Prior: 230008 83237678 0.276% 3.316%
Current: 558390 81120795 0.688% 8.260%
0.431% 5.177%
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-Aug-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: 6037234 84053402 7.183%
1 Month Prior: 7020699 82421954 8.518%
Current: 8436646 79819637 10.570%
8.757%
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: 1,024,867 85,135,586 1.204% 14.446%
1 Month Prior: 1,267,550 83,237,678 1.523% 18.274%
Current: 806,056 81,120,795 0.994% 11.924%
1.240% 14.881%
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-Aug-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: 280640 85135586 0.330% 3.956%
1 Month Prior: 230008 83237678 0.276% 3.316%
Current: 558390 81120795 0.688% 8.260%
0.431% 5.177%
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-Aug-98
Class A Interest Schedule
Opening Class A Principal Balance 74985491
Class A Interest Rate 5.88%
30/360*Class A Interest Rate 0.49%
Current Class A Interest Distribution 367429
Prior Class A Interest Arrearage 0
Class A Interest Due 367429
Current Class A Interest Arrearage 0
Class A Principal Schedule
Opening Class A Principal Balance 75003978
Principal Adjustment -18487
74985491
Scheduled Principal 1235375
Prepayments 497732
Liquidated Contracts 869210
Less: Principal write-up adjustment
2602317
Retransfers 0
2602317
Class A Share - 91% 2368108
Remaining Prefunding Account Balance 0
Principal due to Class A 2368108
Prepayment from Revolving Account 0
Prepayment From Pre-Funding Account 0
Prior Class A Arrearage 0
Class A Principal Due 2368108
Class A Principal Distribution 2368108
Current Class A Arrearage 0
Ending Class A Principal Balance after current Distribution 72635870
Servicing Fee Schedule
Beginning Collateral Balance 82421954
Annual Servicing Rate 2.00%
Prior Servicing Fee Arrearage 0
Current Servicer Fee 137370
Servicer Fee Due 137370
Servicer Fee Paid 137370
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 72635870
Insurance Premium 0.350%
Insurance Premium Supplement 0.00%
Certificate Insurer Fee 21185
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 -20937
Opening Spread Account Balance 4681319
Required Balance Spread Account 7183767
Required Deposit to Spread Account 2502449
Ending Spread Account Balance 5076403
Remaining Deposit Required 2107364
Cap 7183767
Floor 72635870
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
08/21/98
Class A Certificate Factor
Current Class A Balance 72635870
Initial Class A Balance 85200000
Certificate Factor: 0.8525336802
Aggregate Contract Principal Balance 79819637
Class A Balance 72635870
Less: Prefunding Account 0
Receivable backed Certificates 72635870
A Investor Percentage 91.00%
Weighted Average Coupon 19.11%
Weighted Average Maturity 46.47
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Aug-98
Beginning of Transaction 12/16/97
Payment Date 08/21/98
Month of Transaction 8
Period Ended 07/31/98
Collection Account
Beginning Balance 0
Collections during the Collections Period 3292382
Retransfer Amount received in respect of any Retransferred Contracts 0
Any income and gain from investments of funds in the Collect Acct 16592
Amounts received from the Transferor, Master Servicer or Subservicer 0
Late Payment Fees collected with respect to the Contracts on Deposit 3205
Supplemental Servicing Fee 0
Amounts deposited with respect to Retransferred Accounts 0
Scheduled Principal 1235375
Prepayments 497732
Recoveries 310819
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 Account 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 Retransferred Contracts 0
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
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 20937
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Aug-98
Number of loans currently owned by Trust 7032
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 Months
Current Prior Prior Prior
30+ Days Past Due 5875719 5225810 4458971 3936766
60+ Days Past Due 1737253 1201553 969767 1157762
90+ Days Past Due 823675 593336 608496 362574
Delinquent (30+ days past due) 8436646 7020699 6037234 5457101
Current Month Repos 259555 685117 650115 474957
New over 90 Days 546501 582433 374752 220662
Defaults 806056 1267550 1024867 695619
Liquidated Contracts
Repos > 90 Days 203006 78398 28082 12537
Closed Repo's 479268 278280 664971 404302
Past Due > 120 Days 84571 89468 0 0
Chapter 13 Bankruptcy 102365 0 0 0
Net Liquidated Accounts 869210 446145 693053 416839
Recoveries - net of expenses 310819 216138 412413 221815
Net Losses 558390 230008 280640 195024
ACPB 79819637 82421954 84053402 86217769
7183767.3
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
10196022
National Auto Finance 1998-1 Trust
Monthly Servicer Certificate
21-Aug-98
Amount
World Omni to World Omni ( Servicer) Reconciliation
Opening Principal Balance 80686950
Add: New Accounts Transferred 0
Less: Scheduled Principal Received -1235375
Prepaid Accounts -497732
Repossessed Accounts -321619
Total principal reductions -2054726
Plus BNI Conversion Write Up
Closing Principal Balance 78632224
Closing Principal Balance per BNI 77721622
Difference 910602
ACPB Reconciliation
Closing Principal Balance 77721622
Add: Non Liquidated Repo Inventory
deducted from World Omni balance but
not passed through to investors 1218398
Adjusted Principal Balance 78940020
ACPB Prior to ACPB Current Reconciliation
Prior Month ACPB 82421954
Add: New Accounts Transferred 0
Less: Scheduled Principal Received -1235375
Prepaid Accounts -497732
Less: Liquidated Accounts -869210
Plus: BNI Conversion Write Up 0
Current Month ACPB 79819637
Adjusted Principal Balance 78940020
Current Month ACPB 79819637
Difference -879617
Repo
Repo/Liquidated Accounts Repo Prin Liquidated Prin 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 280387 446280
06/30/98 734195 278408 455787
07/31/98 321619 5288 316331
3538521 2320122 1218398
91% Investor Balance:
Ending Class A Balance 72635870
Current ACPB 79819637
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: July 31, 1998
