<PAGE>
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: November 24, 1998
-----------------
HOUSEHOLD AUTOMOBILE REVOLVING TRUST I, SERIES 1998-1
-------------------------------------------------------
(Exact name of registrant as specified in its charter)
HOUSEHOLD FINANCE CORPORATION
----------------------------------------------------
(Master Servicer to the Trust)
(Exact name as specified in Master Servicer's charter)
Not
Delaware 333-59837 Applicable
- ---------------------- ------------------------- --------------
(State or other juris- (Commission File Numbers) (IRS Employer
diction of incorpora- Identification
tion of Master Servicer) Number of
Registrant)
2700 Sanders Road, Prospect Heights, Illinois 60070
- -------------------------------------------------------------------
(Address of principal executive offices of (Zip Code)
Master Servicer)
847/564-5000
-----------------------------------------------------
Administrator's telephone number, including area code
<PAGE>
Item 5. OTHER EVENTS
Attached as Exhibit 99 are certain Computational Materials used in
the distribution of the Household Automobile Revolving Trust I,
Series 1998-1 (the "Notes") which will be issued on December 3,
1998. The Prospectus relating to such offering will be filed on
November 24, 1998.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
--------
99 Computational Materials used in the offering of the Notes.
-2-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Master Servicer has duly caused this report to be signed on behalf of the
undersigned hereunto duly authorized.
HOUSEHOLD FINANCE CORPORATION,
as Master Servicer to and on behalf of the
HOUSEHOLD AUTOMOBILE REVOLVING TRUST I,
SERIES 1998-1
-------------------------------------------
(Registrant)
By: /s/ J. W. Blenke
-----------------------------------
J. W. Blenke
Assistant Secretary
Dated: November 24, 1998
-----------------
-3-
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Page
- ------- -------
<S> <C> <C>
99 Computational Materials used in the offering
of the Notes.
</TABLE>
-4-
<PAGE>
NOVEMBER 1998 CONFIDENTIAL
MATERIALS PREPARED FOR DISCUSSION
HOUSEHOLD INTERNATIONAL, INC.
<PAGE>
CONFIDENTIAL
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
KEY FINANCIAL STATISTICS
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
<TABLE>
<S> <C>
Owned Assets:(1) $49.5 billion
Managed Assets:(1) $72.1 billion
Shareholders' Equity:(1) $6.1 billion
Market Capitalization:(2) $17.3 billion
ROE:(3) 18.2%
Net Income:(3) $686.6 million
EPS:(3) $6.59
</TABLE>
(1) As of June 30, 1998.
(2) As of November 12, 1998.
(3) Fiscal year ended December 31, 1997.
[LOGO]
<PAGE>
CONFIDENTIAL
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
DELINQUENCY EXPERIENCE - HAFC
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(DOLLARS IN THOUSANDS)
- ------------------------------------------------------------------------------------------------------------------------------------
AT DECEMBER 31, AT SEPTEMBER 30,
------------------------------------------------------------------ ----------------
1993 1994 1995 1996 1997(5) 1998(5)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Principal Balance Outstanding(1) $780 $42,837 $117,539 $251,751 $607,802 $1,302,070
Principal Balance of
Contracts Delinquent(2)(4)
30 Days 0 1,014 3,218 8,297 23,784 44,264
60 Days 14 247 1,171 2,847 8,498 16,101
90 Days 0 133 607 1,515 3,939 8,673
Total Balance of Contracts Delinquent 14 1,394 4,996 12,659 36,221 69,038
Delinquencies as a Percentage of Principal
Outstanding 1.79% 3.25% 4.25% 5.03% 5.96% 5.30%
Total Ending Balance of Contracts in
Repossession (3) $0 $261 $861 $2,241 $6,495 $12,954
Repossessions as Percentage of Contracts
Outstanding 0.00% 0.61% 0.73% 0.89% 1.07% 0.99%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Amount outstanding is the outstanding principal balance.
(2) The period of delinquency is based on the number of days payments are
contractually past due.
(3) Amounts shown represent the remaining balance of contracts for which the
finance vehicles have been repossessed, but not yet liquidated.
(4) Delinquencies include bankruptcies. Bankruptcies represent approximately
0.5% of outstanding principal for each period presented.
(5) In October 1997, HAFC implemented changes to its charge-off policy for
owned receivables. The former policy for owned receivables was to
charge-off at 120 days past due. For repossessed vehicles for which
the account was not yet 120 days past due, charge-off occurred at 60
days after the repossession date. The revised policy for owned
receivables is to charge-off at 150 days past due, or for
repossessed vehicles for which the account is not yet 150 days past
due, the charge-off occurs at 90 days after the repossession date.
The impact of this change increased the December 31, 1997 and
September 30, 1998 delinquency ratios by approximately .01% and
.17%, respectively.
[LOGO]
<PAGE>
CONFIDENTIAL
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
LOSS EXPERIENCE - HAFC
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(DOLLARS IN THOUSANDS)
- ------------------------------------------------------------------------------------------------------------------------------------
AT DECEMBER 31, AT SEPTEMBER 30,
-------------------------------------------------------------- ----------------
1993 1994 1995 1996 1997(4) 1998(4)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Principal Amount Outstanding(1) $780 $42,837 $117,539 $251,751 $607,802 $1,302,070
Average Principal Amount $390 $19,099 $79,304 $178,316 $411,194 $915,401
Outstanding
Number of Contracts 71 3,951 10,935 23,145 53,856 108,145
Outstanding
Average Number of Contracts 36 1,750 7,340 16,515 36,964 78,175
Outstanding
Number of Repossessions 0 61 520 1,530 3,686 5,388
Number of Repossessions as % of Average
Number of Contracts Outstanding(2)
0.00% 3.48% 7.08% 9.26% 9.97% 9.18%
Net Losses(3) $0 $262 $3,042 $7,918 $23,700 $33,954
Net Losses as a Percent of Average Principal
Amount Outstanding(2)(3) 0.00% 1.37% 3.84% 4.44% 5.76% 4.94%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Amount outstanding is the outstanding principal balance.
(2) Annualized.
(3) Net Losses are net of recoveries and include remaining principal balance at
time of charge off. In the case of repossession, net losses include
the remaining balance at the time of repossession less liquidation
proceeds (for disposed vehicles ) or the NADA wholesale value (for
vehicles repossessed but not sold). Net losses do not include
repossessions that are less than 150 days delinquent and are not
charged off.
(4) In October 1997, HAFC implemented changes to its charge-off policy for
owned receivables. The former policy for owned receivables was to
charge-off at 120 days past due. For repossessed vehicles for which
the account was not yet 120days past due, charge-off occurred at 60
days after the repossession date. The revised policy for owned
receivables is to charge-off at 150 days past due, or for
repossessed vehicles for which the account is not yet 150 days past
due, the charge-off occurs at 90 days after the repossession date.
The impact of this change increased the December 31, 1997 and
September 30, 1998 delinquency ratios by approximately .01% and
.17%, respectively.
[LOGO]
<PAGE>
CONFIDENTIAL
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
HAFC AUTO SECURITIZATION 1998-1
- --------------------------------------------------------------------------------
- THE SECURITIZATION WILL BE STRUCTURED VERY SIMILAR TO THE
FOLLOWING TABLE:
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-4 CLASS A-5 CLASS B-1
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Size of offering (1) $139.4 $54.0 $143.0 $80.8 $100.0 $99.3
Ratings A-1+/P-1 AAA/Aaa AAA/Aaa AAA/Aaa AAA/Aaa AA/Aa2
Projected Average Life 0.23 1.03 2.00 3.25 1.64 1.73
Projected Principal
Lockout (months) 0 9 15 34 0 7
Projected Principal
Payment Window
(months) 6 7 20 7 41 34
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Dollars in millions.
[LOGO]
<PAGE>
CONFIDENTIAL
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
KEY COLLATERAL STATISTICS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
AMERICREDIT AFG (KEYCORP) HAFC
1998-D 1997-B 1998-1
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
WAC (initial) 18.31% 20.03% 19.77%
WAM (months) 57 54 56
Seasoning (months) 1 3 5
New 25.56% 10.63% 20.4%
Used 74.44% 89.17% 79.6%
Geographic Concentration 14.20%CA 22.11%NC 16.28%TX
9.04%TX 18.06%CA 12.73%CA
Average Loan Balance $13,152 $12,215 $13,062
Serviced Portfolio Net Losses 5.3%(1) N/A 4.9%(2)
Serviced Portfolio Delinquencies 9.6%(1) N/A 6.3%(2)
- ----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Fiscal Year ended June 30, 1998.
(2) Nine months ended September 30, 1998.
[LOGO]
<PAGE>
CONFIDENTIAL
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
PROJECTED CREDIT ENHANCEMENT - 1998-1 CLASS A
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------
INITIAL ENHANCEMENT TARGET ENHANCEMENT
% %
- ----------------------------------------------------------------------------
<S> <C> <C>
Class B-1 12.00% 12.00%
Class B-2 11.40% 11.40%
Class C 7.35% 7.35%
Overcollateralization 6.75% 10.75%
Reserve Fund 1.00% 3.00%(1)
---------- ----------
TOTAL 38.50% 44.50%
- ----------------------------------------------------------------------------
</TABLE>
(1) Floor is 2.00% of original pool balance.
[LOGO]
<PAGE>
CONFIDENTIAL
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
PROJECTED CREDIT ENHANCEMENT - 1998-1 CLASS B-1
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------
INITIAL ENHANCEMENT TARGET ENHANCEMENT
% %
- ----------------------------------------------------------------------------
<S> <C> <C>
Class B-2 11.40% 11.40%
Class C 7.35% 7.35%
Overcollateralization 6.75% 10.75%
Reserve Fund 1.00% 3.00%(1)
---------- ----------
TOTAL 26.50% 32.50%
- ----------------------------------------------------------------------------
</TABLE>
(1) Floor is 2.00% of original pool balance.
[LOGO]
