CONSUMER PORTFOLIO SERVICES, INC.

Previous wording

We were incorporated and began our operations in March 1991. From inception through June 30, 2026, we have originated a total of approximately $26.0 billion of automobile contracts from dealers, and to a lesser degree, by originating loans secured by automobiles directly with consumers. Our recent history of contract purchase volumes and managed portfolio levels are shown in the table below. Managed portfolio comprises both contracts we owned and those we were servicing for third parties.

Current wording

We were incorporated and began our operations in March 1991. From inception through September 30, 2026, we have originated a total of approximately $26.8 billion of automobile contracts from dealers, and to a lesser degree, by originating loans secured by automobiles directly with consumers. Our recent history of contract purchase volumes and managed portfolio levels are shown in the table below. Managed portfolio comprises both contracts we owned and those we were servicing for third parties.

Previous wording

Since 1994 we have conducted 109 term securitizations of automobile contracts that we originated. As of June 30, 2026, 19 of those securitizations are active and all are structured as secured financings. We generally conduct our securitizations on a quarterly basis, near the beginning of each calendar quarter, resulting in four securitizations per calendar year.

Current wording

Since 1994 we have conducted 110 term securitizations of automobile contracts that we originated. As of September 30, 2026, 19 of those securitizations are active and all are structured as secured financings. We generally conduct our securitizations on a quarterly basis, near the beginning of each calendar quarter, resulting in four securitizations per calendar year.

Previous wording

Generally, prior to a securitization transaction we fund our automobile contract purchases primarily with proceeds from warehouse credit facilities. As of June 30, 2026 our short-term funding capacity was $725.0 million over two credit facilities. The first credit facility was established in May 2012.

Current wording

Generally, prior to a securitization transaction we fund our automobile contract purchases primarily with proceeds from warehouse credit facilities. As of September 30, 2026 our short-term funding capacity was $898.0 million over two credit facilities. The first credit facility was established in May 2012.

Previous wording

In October 2025, we entered into a new $167.5 million facility. On April 3, 2026, it amended its two-year revolving credit agreement with Capital One, N.A. to increase the capacity of the facility. The amendment applies to both Capital One, N.A. and the subordinate lender, and increases the capacity of the facility from $167.5 million to $390 million. This facility has a two-year revolving period to October 2027, with an optional amortization period through April 2029.

Current wording

On October 9, 2026, we amended our two-year revolving credit agreement with Capital One, N.A. to increase the capacity of the facility. The amendment applies to both Capital One, N.A. and the subordinate lender, and increases the total capacity of the facility from $390 million to $518 million. This facility has a two-year revolving period to October 2027, with an optional amortization period through April 2029.

Previous wording

In addition, from time to time, we have also completed financings of our residual interests in other securitizations that we and our affiliates previously sponsored. Most recently, in March 2026, we completed a $50 million securitization of residual interests from previously issued securitizations. In the transaction, qualified institutional buyers purchased $50.0 million of asset-backed notes secured by an 80% interest in a CPS affiliate that owns the residual interests in four CPS securitizations issued from January 2025 through October 2025. The sold notes (“2026-1 Notes”), issued by CPS Auto Securitization Trust 2026-1, consist of a single class with a coupon of 8.75%.

Current wording

In addition, from time to time, we have also completed financings of our residual interests in other securitizations that we and our affiliates previously sponsored. Most recently, in August 2026, we completed an $80 million securitization of residual interests from previously issued securitizations. In this transaction, a qualified institutional buyer purchased $80.0 million of asset-backed notes. The notes are secured by residual interests in four CPS securitizations issued between April 2022 and April 2023, as well as an 80% interest in a CPS affiliate that owns the residual interests in three CPS securitizations issued between July 2023 and April 2026. The sold notes (“2026-2 Notes”), issued by CPS Auto Securitization Trust 2026-2, consist of a single class with a coupon of 10.25%.

Previous wording

Revenues. During the three months ended June 30, 2026, our revenues were $121.4 million, an increase of $11.6 million, or 10.6% from the prior year revenue of 109.8 million. The primary reason for the increase in revenues is the increase in interest income resulting from the increase in the average outstanding balance of finance receivables measured at fair value. Revenues for the three months ended June 30, 2026, did not include a mark to the recorded value of the finance receivables measured at fair value. Marks are estimates based on our evaluation of the appropriate fair value and future earnings rate of existing receivables compared to recently acquired receivables and increases or decreases in our estimates of future net losses. In the current period, our re-evaluation of the fair values of these receivables resulted in no marks to finance receivables measured at fair value. There was a $3.0 million mark up to the fair value portfolio in the prior year period.

Current wording

Revenues. During the three months ended September 30, 2026, our revenues were$131.9 million, an increase of $23.5 million, or 21.7% from the prior year revenue of 108.4 million. The primary reason for the increase in revenues is the increase in interest income resulting from the increase in the average outstanding balance of finance receivables measured at fair value. Revenues for the three months ended September 30, 2026, did not include a mark to the recorded value of the finance receivables measured at fair value. Marks are estimates based on our evaluation of the appropriate fair value and future earnings rate of existing receivables compared to recently acquired receivables and increases or decreases in our estimates of future net losses. In the current period, our re-evaluation of the fair values of these receivables resulted in no marks to finance receivables measured at fair value.

Previous wording

Interest income for the three months ended June 30, 2026, increased $12.8 million, or 12.1% to $118.1 million from $105.4 million in the prior year. The primary reason for the increase in interest income is the 13.7% increase in the average balance of our loan portfolio over the prior year period. The interest yield on our total loan portfolio decreased to 11.3% from 11.4% in the prior year period. The interest yield on receivables measured at fair value is reduced to take account of expected losses and is therefore less than the yield on other finance receivables. The table below shows the average balance and interest yield of our loan portfolio for the three months ended June 30, 2026 and 2025:

Current wording

Interest income for the three months ended September 30, 2026, increased $21.9 million, or 20.5% to $129.1 million from $107.2 million in the prior year. The primary reason for the increase in interest income is the 22.2% increase in the average balance of our loan portfolio over the prior year period. The interest yield on our total loan portfolio decreased to 11.3% from 11.4% in the prior year period. The interest yield on receivables measured at fair value is reduced to take account of expected losses and is therefore less than the yield on other finance receivables. The table below shows the average balance and interest yield of our loan portfolio for the three months ended September 30, 2026 and 2025:

Previous wording

Other income was $3.3 million forthe three months ended June 30, 2026, compared to $1.4 million for the comparable period in 2025. This $1.9 million increase was primarily driven by the dealer recoveries collected for the three months ending June 30, 2026. These dealer recoveries were $1.8 million for the quarter ended June 30, 2026. There were no dealer recoveries in the prior year period. The Company engaged a third party that identifies discrepancies in the values of the vehicles that have been repossessed and sold at auction. The third party attempts to collect the amount of the discrepancy from the dealers and remits the amounts collected to the Company net of fees charged.

Current wording

Other income was $2.8 million forthe three months ended September 30, 2026, compared to $1.3 million for the comparable period in 2025. This $1.6 million increase was primarily driven by the dealer recoveries collected for the three months ending September 30, 2026. These dealer recoveries were $1.4 million for the quarter ended September 30, 2026. There were no dealer recoveries in the prior year period. The Company engaged a third party that identifies discrepancies in the values of the vehicles that have been repossessed and sold at auction. The third party attempts to collect the amount of the discrepancy from the dealers and remits the amounts collected to the Company net of fees charged.

Previous wording

Total operating expenses were $112.4 million for the three months ended June 30, 2026, compared to $102.8 million for the prior period, an increase of $9.5 million, or 9.3%. The increase is primarily due to increases in interest expense.

Current wording

Total operating expenses were $121.8 million for the three months ended September 30, 2026, compared to $101.4 million for the prior period, an increase of $20.4 million, or 20.2%. The increase is primarily due to increases in interest expense.

Previous wording

Employee costs were $23.4 million during the three months ended June 30, 2026, compared to $24.4 million for the same quarter in the prior year, a decrease of $944,000, or 3.9%. The table below summarizes our employees by category as well as contract purchases and units in our managed portfolio as of, and for the three-month periods ended, June 30, 2026, and 2025.

Current wording

Employee costs were $24.9 million during the three months ended September 30, 2026, compared to $22.5 million for the same quarter in the prior year, an increase of $2.4 million, or 10.7%. The table below summarizes our employees by category as well as contract purchases and units in our managed portfolio as of, and for the three-month periods ended, September 30, 2026, and 2025.

Previous wording

The increase in headcount within our Sales staff throughout the six-month periods ended, June 30, 2026, and the decrease in the average employee cost of our Servicing staff from June 30, 2025, were the largest contributing factors to the increase in headcount and decrease to employee costs from the six-month period ended, June 30, 2025 to June 30, 2026.

Current wording

The increase in headcount within our Servicing and Origination staff throughout the three-month periods ended, September 30, 2026, were the largest contributing factors to the increase to employee costs from the three-month period ended, September 30, 2025 to September 30, 2026.

Previous wording

General and administrative expenses include costs associated with purchasing and servicing our portfolio of finance receivables, including expenses for facilities, credit services, and telecommunications. General and administrative expenses were $14.7 million, an increase of $2.3 million from $12.4 million in the prior year period.

Current wording

General and administrative expenses include costs associated with purchasing and servicing our portfolio of finance receivables, including expenses for facilities, credit services, and telecommunications. General and administrative expenses were $15.6 million, an increase of $2.9 million from $12.7 million in the prior year period.

Previous wording

Interest expense for the three months ended June 30, 2026, was $64.3 million and represented 57.2% of total operating expenses, compared to $58.7 million in the previous year, when it was 57.1% of total operating expenses. The $5.5 million increase in interest expense compared to the prior year period was largely due to increases in the average balance of our securitization trust debt, warehouse credit line debt and residual interest financing debt.

Current wording

Interest expense for the three months ended September 30, 2026, was $70.5 million and represented 57.9% of total operating expenses, compared to $59.1 million in the previous year, when it was 58.3% of total operating expenses. The $11.4 million increase in interest expense compared to the prior year period was largely due to increases in the average balance of our securitization trust debt, warehouse credit line debt and residual interest financing debt.

Previous wording

Interest on securitization trust debt increased by $4.5 million for the three months ended June 30, 2026, compared to the prior period. The average balance of securitization trust debt increased to $3,272.1 million for the three months ended June 30, 2026, compared to $2,811.9 million for the three months ended June 30, 2025. The annualized average rate on our securitization trust debt was 6.1% for the three months ended June 30, 2026, compared to 6.5% in the prior year period. For each quarterly securitization transaction, the blended cost of funds is ultimately the result of many factors including the market interest rates for benchmark swaps of various maturities against which our bonds are priced and the margin over those benchmarks that investors are willing to accept, which in turn, is influenced by investor demand for our bonds at the time of the securitization. These and other factors have resulted in fluctuations in our securitization trust debt interest costs. The blended interest rates of our recent securitizations are summarized in the table below:

Current wording

Interest on securitization trust debt increased by $6.7 million for the three months ended September 30, 2026, compared to the prior period. The average balance of securitization trust debt increased to $3,609.0 million for the three months ended September 30, 2026, compared to $3,039.5 million for the three months ended September 30, 2025. The annualized average rate on our securitization trust debt was 6.0% for the three months ended September 30, 2026, compared to 6.3% in the prior year period. For each quarterly securitization transaction, the blended cost of funds is ultimately the result of many factors including the market interest rates for benchmark swaps of various maturities against which our bonds are priced and the margin over those benchmarks that investors are willing to accept, which in turn, is influenced by investor demand for our bonds at the time of the securitization. These and other factors have resulted in fluctuations in our securitization trust debt interest costs. The blended interest rates of our recent securitizations are summarized in the table below:

Previous wording

Interest expense on warehouse credit line debt increased by $617,000 to $8.8 million for the three months ended June 30, 2026, compared to $8.2 million in the prior year period. The increase was primarily due to the higher utilization of our credit lines during the quarter compared to last year. The average balance of our warehouse debt was $445.6 million during the three months ended June 30, 2026, compared to $353.2 million for the same period in 2025. The annualized average rate on our credit line debt was 7.9% for the three months ended June 30, 2026, compared to 9.3% in the prior year period.

Current wording

Interest expense on warehouse credit line debt increased by $3.5 million to $10.3 million for the three months ended September 30, 2026, compared to $6.7 million in the prior year period. The increase was primarily due to the higher utilization of our credit lines during the quarter compared to last year. The average balance of our warehouse debt was $510.9 million during the three months ended September 30, 2026, compared to $284.6 million for the same period in 2025. The annualized average rate on our credit line debt was 8.0% for the three months ended September 30, 2026, compared to 9.4% in the prior year period.

Previous wording

Interest expense on subordinated renewable notes was $668,000 for the three months ended June 30, 2026. The average balance of the outstanding subordinated debt was $28.1 million for the three months June 30, 2026, compared to $28.0 million for the prior year period. The average yield of subordinated notes is 9.5% for the three months ended June 30, 2025, compared to 9.7% in the prior year period.

Current wording

Interest expense on subordinated renewable notes was $673,000 for the three months ended September 30, 2026. The average balance of the outstanding subordinated debt was $28.7 million for the three months September 30, 2026, compared to $29.0 million for the prior year period. The average yield of subordinated notes is 9.4% for the three months ended September 30, 2026, compared to 10.0% in the prior year period.

Previous wording

In June 2021, March 2024, March 2025, and again in March 2026 we completed a securitization of residual interests from other previously issued securitizations in the amount of $50 million, $50 million, $65 million, and $50 million, respectively. Interest expense for these residual interest financings was $4.7 million for the three months ended June 30, 2026, compared to $4.2 million for the same period in 2025.

Current wording

In June 2021, March 2024, March 2025, March 2026, and again in August 2026, we completed a securitization of residual interests from other previously issued securitizations in the amount of $50 million, $50 million, $65 million, $50 million, and $80 million, respectively. Interest expense for these residual interest financings was $5.3 million for the three months ended September 30, 2026, compared to $4.1 million for the same period in 2025.

Previous wording

Sales expenses consist primarily of commission-based compensation paid to our employee sales representatives. Our sales representatives earn a salary plus commission based on volume of contract purchases. Sales expense increased by $2.6 to $8.3 million during the three months ended June 30, 2026, from $5.7 million for the same quarter in 2025. We purchased $757.7 million of new contracts during the three months ended June 30, 2026, compared to $433.0 million in the prior year period.

Current wording

Sales expenses consist primarily of commission-based compensation paid to our employee sales representatives. Our sales representatives earn a salary plus commission based on volume of contract purchases. Sales expense increased by $3.5 to $9.1 million during the three months ended September 30, 2026, from $5.7 million for the same quarter in 2025. We purchased $815.3 million of new contracts during the three months ended September 30, 2026, compared to $391.1 million in the prior year period.

Previous wording

Occupancy expenses were $1.5 million for the three months ending June 30, 2026, which is up from $1.4 million in the second quarter of 2025.

Current wording

Occupancy expenses were $1.5 million for the three months ending September 30, 2026, which is up from $1.2 million in the third quarter of 2025.

Previous wording

For the three months ended June 30, 2026, we recorded income tax expense of $2.8 million, representing a 31% effective tax rate. In the prior period, our income tax expense was $2.2 million, representing a 31% effective tax rate.

Current wording

For the three months ended September 30, 2026, we recorded income tax expense of $3.1 million, representing a 31% effective tax rate. In the prior period, our income tax expense was $2.2 million, representing a 31% effective tax rate.

Previous wording

Comparison of Operating Results for the six months ended June 30, 2026 with the six months ended June 30, 2025

Current wording

Comparison of Operating Results for the nine months ended September 30, 2026 with the nine months ended September 30, 2025

Previous wording

Revenues. During the six months ended June 30, 2026, our revenues were $233.7 million, an increase of $17.1 million, or 7.9% from the prior year revenue of $216.6 million. The primary reason for the increase in revenues is the increase in interest income resulting from the increase in the average outstanding balance of finance receivables measured at fair value. Revenues for the six months ended June 30, 2026, did not include a mark to the recorded value of the finance receivables measured at fair value. The marks are estimates based on our evaluation of the appropriate fair value and future earnings rate of existing receivables compared to recently acquired receivables and increases or decreases in our estimates of future net losses. In the current period, our re-evaluation of the fair values of these receivables resulted in no marks to finance receivables measured at fair value. There was a $6.5 million mark up to the fair value portfolio in the prior year period.

Current wording

Revenues. During the nine months ended September 30, 2026, our revenues were $365.6 million, an increase of $40.6 million, or 12.5% from the prior year revenue of $325.1 million. The primary reason for the increase in revenues is the increase in interest income resulting from the increase in the average outstanding balance of finance receivables measured at fair value. Revenues for the nine months ended September 30, 2026, did not include a mark to the recorded value of the finance receivables measured at fair value. The marks are estimates based on our evaluation of the appropriate fair value and future earnings rate of existing receivables compared to recently acquired receivables and increases or decreases in our estimates of future net losses. In the current period, our re-evaluation of the fair values of these receivables resulted in no marks to finance receivables measured at fair value. There was a $6.5 million mark up to the fair value portfolio in the prior year period.

Previous wording

Interest income for the six months ended June 30, 2026 increased $19.5 million, or 9.4%, to $226.8 million from $207.3 million in the prior year. The primary reason for the increase in interest income is the 10.8% increase in the average balance of our loan portfolio over the prior year period. The interest yield on our total loan portfolio decreased from 11.4% in the prior year period to 11.3% in the current year period. The interest yield on receivables measured at fair value is reduced to take account of expected losses and is therefore less than the yield on other finance receivables. The table below shows the average balance and interest yield of our loan portfolio for the six months ended June 30, 2026 and 2025:

Current wording

Interest income for the nine months ended September 30, 2026 increased $41.5 million, or 13.2%, to $355.9 million from $314.5 million in the prior year. The primary reason for the increase in interest income is the 14.7% increase in the average balance of our loan portfolio over the prior year period. The interest yield on our total loan portfolio decreased from 11.4% in the prior year to 11.3% in the current year period. The interest yield on receivables measured at fair value is reduced to take account of expected losses and is therefore less than the yield on other finance receivables. The table below shows the average balance and interest yield of our loan portfolio for the nine months ended September 30, 2026 and 2025:

Previous wording

Other income was $6.9 million forthe six months ended June 30, 2026 compared to $2.8 million for the comparable period in 2025. This $4.1 million increase was primarily driven by the dealer recoveries collected for the six months ended June 30, 2026. These dealer recoveries were $4.1 million for the six months ended June 30, 2026. There were no dealer recoveries in the prior year period.

Current wording

Other income was $9.7 million forthe nine months ended September 30, 2026 compared to $4.1 million for the comparable period in 2025. This $5.6 million increase was primarily driven by the dealer recoveries collected for the nine months ended September 30, 2026. These dealer recoveries were $4.0 million for the nine months ended September 30, 2026. There were no dealer recoveries in the prior year period.

Previous wording

Total operating expenses were $216.7 million for the six months ended June 30, 2026, compared to $202.9 million for the prior period, an increase of $13.8 million, or 6.8%. The increase is primarily due to increases in interest expense. To a lesser extent, increases in sales expense also contributed to the increase in operating expenses during the period.

Current wording

Total operating expenses were $338.5 million for the nine months ended September 30, 2026, compared to $304.3 million for the prior period, an increase of $34.2 million, or 11.2%. The increase is primarily due to increases in interest expense. To a lesser extent, increases in sales expense also contributed to the increase in operating expenses during the period.

Previous wording

Employee costs were $46.5 million during the six months ended June 30, 2026 compared to $49.4 million for the same period in the prior year. The table below summarizes our employees by category as well as contract purchases and units in our managed portfolio as of, and for the six-month periods ended, June 30, 2026 and 2025:

Current wording

Employee costs were $71.3 million during the nine months ended September 30, 2026 compared to $71.9 million for the same period in the prior year. The table below summarizes our employees by category as well as contract purchases and units in our managed portfolio as of, and for the nine-month periods ended, September 30, 2026 and 2025:

Previous wording

The increase in headcount within our Sales staff throughout the three-month periods ended, June 30, 2026, and the decrease in the average employee cost of our Servicing staff from June 30, 2025, were the largest contributing factors to the increase in headcount and decrease to employee costs from the three-month period ended, June 30, 2025 to June 30, 2026.

Current wording

The increase in headcount within our Servicing and Originations staff throughout the nine-month periods ended, September 30, 2026, and the decrease in the average employee cost of our Servicing staff from September 30, 2025, were the largest contributing factors to the increase in headcount and decrease to employee costs from the nine-month period ended, September 30, 2025 to September 30, 2026.

Previous wording

General and administrative expenses include costs associated with purchasing and servicing our portfolio of finance receivables, including expenses for facilities, credit services, and telecommunications. General and administrative expenses were $27.6 million for the six months ended June 30, 2026, an increase of $2.6 from $25.0 million in the prior year period.

Current wording

General and administrative expenses include costs associated with purchasing and servicing our portfolio of finance receivables, including expenses for facilities, credit services, and telecommunications. General and administrative expenses were $43.1 million for the nine months ended September 30, 2026, an increase of $5.5 from $37.7 million in the prior year period.

Previous wording

Interest expense for the six months ended June 30, 2026 was $124.3 million, compared to $113.6 million in the previous year, an increase of $10.7 million.

Current wording

Interest expense for the nine months ended September 30, 2026 was $194.8 million, compared to $172.7 million in the previous year, an increase of $22.1 million.

Previous wording

Interest on securitization trust debt increased by $8.2 million for the six months ended June 30, 2026 compared to the prior period. The average balance of securitization trust debt increased to $3,199.7 million for the six months ended June 30, 2026 compared to $2,836.9 million for the six months ended June 30, 2025. The annualized average rate on our securitization trust debt was 6.2% for the six months ended June 30, 2026 compared to 6.4% in the prior year period. For each quarterly securitization transaction, the blended cost of funds is ultimately the result of many factors including the market interest rates for benchmark swaps of various maturities against which our bonds are priced and the margin over those benchmarks that investors are willing to accept, which in turn, is influenced by investor demand for our bonds at the time of the securitization. These and other factors have resulted in fluctuations in our securitization trust debt interest costs. The blended interest rates of our recent securitizations are summarized in the table below:

Current wording

Interest on securitization trust debt increased by $14.9 million for the nine months ended September 30, 2026 compared to the prior period. The average balance of securitization trust debt increased to $3,336.2 million for the nine months ended September 30, 2026 compared to $2,904.4 million for the nine months ended September 30, 2025. The annualized average rate on our securitization trust debt was 6.1% for the nine months ended September 30, 2026 compared to 6.3% in the prior year period. For each quarterly securitization transaction, the blended cost of funds is ultimately the result of many factors including the market interest rates for benchmark swaps of various maturities against which our bonds are priced and the margin over those benchmarks that investors are willing to accept, which in turn, is influenced by investor demand for our bonds at the time of the securitization. These and other factors have resulted in fluctuations in our securitization trust debt interest costs. The blended interest rates of our recent securitizations are summarized in the table below:

Previous wording

Interest expense on warehouse credit line debt increased by $569,000 to $15.3 million for the six months ended June 30, 2026, compared to $14.7 million in the prior year period. The average balance of our warehouse debt was $361.3 million during the six months ended June 30, 2026, compared to $314.7 million for the same period in 2025. The annualized average rate on our credit line debt was 8.5% for the six months ended June 30, 2026, compared to 9.4% in the prior year period.

Current wording

Interest expense on warehouse credit line debt increased by $4.1 million to $25.6 million for the nine months ended September 30, 2026, compared to $21.4 million in the prior year period. The average balance of our warehouse debt was $411.7 million during the nine months ended September 30, 2026, compared to $304.6 million for the same period in 2025. The annualized average rate on our credit line debt was 8.3% for the nine months ended September 30, 2026, compared to 9.4% in the prior year period.

Previous wording

Interest expense on subordinated renewable notes was $1.4 million for the six months ended June 30, 2026. The average balance of the outstanding subordinated debt increased by $890,000 to $28.4 million for the six months ended June 30, 2026, compared to $27.5 million for the prior year. The average yield of subordinated notes was 9.5% in the current compare to 9.7% prior period.

Current wording

Interest expense on subordinated renewable notes was $2.0 million for the nine months ended September 30, 2026. The average balance of the outstanding subordinated debt increased by $481,000 to $28.5 million for the nine months ended September 30, 2026, compared to $28.0 million for the prior year. The average yield of subordinated notes was 9.5% in the current compare to 9.8% prior period.

Previous wording

In June 2021, March 2024, March 2025, and again in March 2026 we completed a securitization of residual interests from other previously issued securitizations in the amount of $50 million, $50 million, $65 million, and $50 million, respectively. Interest expense on the residual interest financing was $8.9 million for the six months ended June 30, 2026 compared to $7.0 million for the same period in 2025.

Current wording

In June 2021, March 2024, March 2025, March 2026, and again in August 2026, we completed a securitization of residual interests from other previously issued securitizations in the amount of $50 million, $50 million, $65 million, $50 million, and $80 million, respectively. Interest expense on the residual interest financing was $14.2 million for the nine months ended September 30, 2026 compared to $11.0 million for the same period in 2025.

Previous wording

The following table presents the components of interest income and interest expense and a net interest yield analysis for the six-month periods ended June 30, 2026 and 2025:

Current wording

The following table presents the components of interest income and interest expense and a net interest yield analysis for the nine-month periods ended September 30, 2026 and 2025:

Previous wording

Sales expenses consist primarily of commission-based compensation paid to our employee sales representatives. Our sales representatives earn a salary plus commissions based on volume of contract purchases. Sales expense increased to $14.9 million during the six months ended June 30, 2026 from $11.6 million in the same period in 2025. We purchased $1,290.9 million of new contracts during the six months ended June 30, 2026 compared to $884.2 million in the prior year period.

Current wording

Sales expenses consist primarily of commission-based compensation paid to our employee sales representatives. Our sales representatives earn a salary plus commissions based on volume of contract purchases. Sales expense increased to $24.0 million during the nine months ended September 30, 2026 from $17.3 million in the same period in 2025. We purchased $2,106.2 million of new contracts during the nine months ended September 30, 2026 compared to $1,275.3 million in the prior year period.

Previous wording

Occupancy expenses was $3.0 million for the six months ending June 30, 2026, which is up from $2.8 million for the same period in 2025.

Current wording

Occupancy expenses was $4.4 million for the nine months ending September 30, 2026, which is up from $4.0 million for the same period in 2025.

Previous wording

For the six months ended June 30, 2026, we recorded income tax expense of $5.3 million, representing a 31% effective tax rate. In the prior period, our income tax expense was $4.3 million, representing a 31% effective tax rate.

Current wording

For the nine months ended September 30, 2026, we recorded income tax expense of $8.4 million, representing a 31% effective tax rate. In the prior period, our income tax expense was $6.4 million, representing a 31% effective tax rate.

Previous wording

Net cash provided by operating activities for the six-month period ended June 30, 2026 was $189.9 million, an increase of $61.6 million, compared to net cash provided by operating activities for the six-month period ended June 30, 2025 of $128.3 million. Net cash from operating activities is generally provided by net income from operations adjusted for significant non-cash items such as marks to finance receivables measured at fair value.

Current wording

Net cash provided by operating activities for the nine-month period ended September 30, 2026 was $284.5 million, an increase of $71.3 million, compared to net cash provided by operating activities for the nine-month period ended September 30, 2025 of $213.2 million. Net cash from operating activities is generally provided by net income from operations adjusted for significant non-cash items such as marks to finance receivables measured at fair value.

Previous wording

Net cash used in investing activities was $697.0 million for the six months ended June 30, 2026 compared to $360.8 million in the prior year period. Net cash used in investing activities generally relates to new purchases of automobile contracts net of principal payments and other proceeds received during the period. Purchases of finance receivables excluding acquisition fees were $1,266.6 million and $882.9 million during the first six months of 2026 and 2025, respectively.

Current wording

Net cash used in investing activities was $1,191.1 million for the nine months ended September 30, 2026 compared to $492.3 million in the prior year period. Net cash used in investing activities generally relates to new purchases of automobile contracts net of principal payments and other proceeds received during the period. Purchases of finance receivables excluding acquisition fees were $2,067.9 million and $1,275.7 million during the first nine months of 2026 and 2025, respectively.

Previous wording

Net cash provided by financing activities for the six months ended June 30, 2026 was $515.1 million compared to $255.3 million in the prior year period. Cash provided by financing activities is primarily related to the issuance of securitization trust debt, reduced by the amount of repayment of securitization trust debt and net proceeds or repayments on our warehouse lines of credit and other debt. In the first six months of 2026, we issued $859.7 million in new securitization trust debt compared to $862.4 million for the same period in 2025. We repaid $715.1 million in securitization trust debt in the six months ended June 30, 2026 compared to repayments of securitization trust debt of $642.7 million in the prior year period. In the six months ended June 30, 2026, we had net advances on warehouse lines of credit of $354.4 million, compared to net repayments from warehouse lines of credit of $16.6 million in the prior year’s period.

Current wording

Net cash provided by financing activities for the nine months ended September 30, 2026 was $914.5 million compared to $293.5 million in the prior year period. Cash provided by financing activities is primarily related to the issuance of securitization trust debt, reduced by the amount of repayment of securitization trust debt and net proceeds or repayments on our warehouse lines of credit and other debt. In the first nine months of 2026, we issued $1,576.6 million in new securitization trust debt compared to $1,280.7 million for the same period in 2025. We repaid $1,103.5 million in securitization trust debt in the nine months ended September 30, 2026 compared to repayments of securitization trust debt of $957.6 million in the prior year period. In the nine months ended September 30, 2026, we had net advances on warehouse lines of credit of $412.5 million, compared to net repayments from warehouse lines of credit of $72.3 million in the prior year’s period.