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Loans Receivable | 12 Months Ended
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Dec. 31, 2014
Receivables [Abstract] |
Loans Receivable | LOANS RECEIVABLE Loans receivable consists of the following:
(In millions) | As of December 31, 2014
| Dealer Loans |  | Purchased Loans |  | Total
Loans receivable | $ | 2,389.8 |  |  | $ | 330.0 |  |  | $ | 2,719.8 |
Allowance for credit losses | (198.1 | ) |  | (8.8 | ) |  | (206.9 | )
Loans receivable, net | $ | 2,191.7 |  |  | $ | 321.2 |  |  | $ | 2,512.9 |
(In millions) | As of December 31, 2013
| Dealer Loans |  | Purchased Loans |  | Total
Loans receivable | $ | 2,155.5 |  |  | $ | 252.7 |  |  | $ | 2,408.2 |
Allowance for credit losses | (185.7 | ) |  | (9.7 | ) |  | (195.4 | )
Loans receivable, net | $ | 1,969.8 |  |  | $ | 243.0 |  |  | $ | 2,212.8 |
A summary of changes in Loans receivable is as follows:
(In millions) | For the Year Ended December 31, 2014
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 2,155.5 |  |  | $ | 252.7 |  |  | $ | 2,408.2 |
New Consumer Loan assignments (1) | 1,471.4 |  |  | 204.3 |  |  | 1,675.7 |
Principal collected on Loans receivable | (1,392.6 | ) |  | (147.5 | ) |  | (1,540.1 | )
Accelerated Dealer Holdback payments | 41.7 |  |  | — |  |  | 41.7 |
Dealer Holdback payments | 135.5 |  |  | — |  |  | 135.5 |
Transfers (2) | (20.5 | ) |  | 20.5 |  |  | — |
Write-offs | (3.1 | ) |  | (0.1 | ) |  | (3.2 | )
Recoveries (3) | 1.8 |  |  | 0.1 |  |  | 1.9 |
Net change in other loans | 0.1 |  |  | — |  |  | 0.1 |
Balance, end of period | $ | 2,389.8 |  |  | $ | 330.0 |  |  | $ | 2,719.8 |
(In millions) | For the Year Ended December 31, 2013
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 1,869.4 |  |  | $ | 240.5 |  |  | $ | 2,109.9 |
New Consumer Loan assignments (1) | 1,356.6 |  |  | 124.0 |  |  | 1,480.6 |
Principal collected on Loans receivable | (1,204.6 | ) |  | (129.8 | ) |  | (1,334.4 | )
Accelerated Dealer Holdback payments | 40.4 |  |  | — |  |  | 40.4 |
Dealer Holdback payments | 114.2 |  |  | — |  |  | 114.2 |
Transfers (2) | (17.9 | ) |  | 17.9 |  |  | — |
Write-offs | (5.2 | ) |  | (0.1 | ) |  | (5.3 | )
Recoveries (3) | 2.2 |  |  | 0.2 |  |  | 2.4 |
Net change in other loans | 0.4 |  |  | — |  |  | 0.4 |
Balance, end of period | $ | 2,155.5 |  |  | $ | 252.7 |  |  | $ | 2,408.2 |
(In millions) | For the Year Ended December 31, 2012
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 1,506.5 |  |  | $ | 246.4 |  |  | $ | 1,752.9 |
New Consumer Loan assignments (1) | 1,253.6 |  |  | 108.8 |  |  | 1,362.4 |
Principal collected on Loans receivable | (1,024.8 | ) |  | (138.0 | ) |  | (1,162.8 | )
Accelerated Dealer Holdback payments | 43.7 |  |  | — |  |  | 43.7 |
Dealer Holdback payments | 115.7 |  |  | — |  |  | 115.7 |
Transfers (2) | (23.8 | ) |  | 23.8 |  |  | — |
Write-offs | (3.6 | ) |  | (0.6 | ) |  | (4.2 | )
Recoveries (3) | 2.2 |  |  | 0.1 |  |  | 2.3 |
Net change in other loans | (0.1 | ) |  | — |  |  | (0.1 | )
Balance, end of period | $ | 1,869.4 |  |  | $ | 240.5 |  |  | $ | 2,109.9 |
(1) | The Dealer Loans amount represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program. The Purchased Loans amount represents one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program.
(2) | Under our Portfolio Program, certain events may result in Dealers forfeiting their rights to Dealer Holdback. We transfer the Dealer’s outstanding Dealer Loan balance to Purchased Loans in the period this forfeiture occurs.
(3) | Represents collections received on previously written off Loans.
Contractual net cash flows are comprised of the contractual repayments of the underlying Consumer Loans for Dealer and Purchased Loans, less the related Dealer Holdback payments for Dealer Loans. The difference between the contractual net cash flows and the expected net cash flows is referred to as the nonaccretable difference. This difference is neither accreted into income nor recorded in our balance sheets. We do not believe that the contractual net cash flows of our Loan portfolio are relevant in assessing our financial position. We are contractually owed repayments on many Consumer Loans, primarily those older than 120 months, where we are not forecasting any future net cash flows. The excess of expected net cash flows over the carrying value of the Loans is referred to as the accretable yield and is recognized on a level-yield basis as finance charge income over the remaining lives of the Loans. A summary of changes in the accretable yield is as follows:
(In millions) | For the Year Ended December 31, 2014
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 667.5 |  |  | $ | 112.8 |  |  | $ | 780.3 |
New Consumer Loan assignments (1) | 593.8 |  |  | 77.2 |  |  | 671.0 |
Finance charge income | (552.8 | ) |  | (77.6 | ) |  | (630.4 | )
Forecast changes | 23.1 |  |  | 12.7 |  |  | 35.8 |
Transfers (2) | (6.4 | ) |  | 11.4 |  |  | 5.0 |
Balance, end of period | $ | 725.2 |  |  | $ | 136.5 |  |  | $ | 861.7 |
(In millions) | For the Year Ended December 31, 2013
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 602.9 |  |  | $ | 115.2 |  |  | $ | 718.1 |
New Consumer Loan assignments (1) | 564.9 |  |  | 50.3 |  |  | 615.2 |
Finance charge income | (517.7 | ) |  | (72.7 | ) |  | (590.4 | )
Forecast changes | 24.9 |  |  | 7.6 |  |  | 32.5 |
Transfers (2) | (7.5 | ) |  | 12.4 |  |  | 4.9 |
Balance, end of period | $ | 667.5 |  |  | $ | 112.8 |  |  | $ | 780.3 |
(In millions) | For the Year Ended December 31, 2012
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 508.0 |  |  | $ | 120.1 |  |  | $ | 628.1 |
New Consumer Loan assignments (1) | 538.7 |  |  | 47.8 |  |  | 586.5 |
Finance charge income | (458.7 | ) |  | (79.5 | ) |  | (538.2 | )
Forecast changes | 25.6 |  |  | 10.0 |  |  | 35.6 |
Transfers (2) | (10.7 | ) |  | 16.8 |  |  | 6.1 |
Balance, end of period | $ | 602.9 |  |  | $ | 115.2 |  |  | $ | 718.1 |
(1) | The Dealer Loans amount represents the net cash flows expected at the time of assignment on Consumer Loans assigned under our Portfolio Program, less the related advances paid to Dealers. The Purchased Loans amount represents the net cash flows expected at the time of assignment on Consumer Loans assigned under our Purchase Program, less the related one-time payments made to Dealers.
(2) | Under our Portfolio Program, certain events may result in Dealers forfeiting their rights to Dealer Holdback. We transfer the Dealer’s outstanding Dealer Loan balance and related expected future net cash flows to Purchased Loans in the period this forfeiture occurs.
Additional information related to new Consumer Loan assignments is as follows:
(In millions) | For the Year Ended December 31, 2014
| Dealer Loans |  | Purchased Loans |  | Total
Contractual net cash flows at the time of assignment (1) | $ | 2,251.4 |  |  | $ | 394.7 |  |  | $ | 2,646.1 |
Expected net cash flows at the time of assignment (2) | 2,065.2 |  |  | 281.5 |  |  | 2,346.7 |
Fair value at the time of assignment (3) | 1,471.4 |  |  | 204.3 |  |  | 1,675.7 |
(In millions) | For the Year Ended December 31, 2013
| Dealer Loans |  | Purchased Loans |  | Total
Contractual net cash flows at the time of assignment (1) | $ | 2,079.8 |  |  | $ | 241.6 |  |  | $ | 2,321.4 |
Expected net cash flows at the time of assignment (2) | 1,921.5 |  |  | 174.3 |  |  | 2,095.8 |
Fair value at the time of assignment (3) | 1,356.6 |  |  | 124.0 |  |  | 1,480.6 |
(In millions) | For the Year Ended December 31, 2012
| Dealer Loans |  | Purchased Loans |  | Total
Contractual net cash flows at the time of assignment (1) | $ | 1,935.1 |  |  | $ | 217.6 |  |  | $ | 2,152.7 |
Expected net cash flows at the time of assignment (2) | 1,792.3 |  |  | 156.5 |  |  | 1,948.8 |
Fair value at the time of assignment (3) | 1,253.6 |  |  | 108.8 |  |  | 1,362.4 |
(1) | The Dealer Loans amount represents the repayments that we were contractually owed at the time of assignment on Consumer Loans assigned under our Portfolio Program, less the related Dealer Holdback payments that we would be required to make if we collected all of the contractual repayments. The Purchased Loans amount represents the repayments that we were contractually owed at the time of assignment on Consumer Loans assigned under our Purchase Program.
(2) | The Dealer Loans amount represents the repayments that we expected to collect at the time of assignment on Consumer Loans assigned under our Portfolio Program, less the related Dealer Holdback payments that we expected to make. The Purchased Loans amount represents the repayments that we expected to collect at the time of assignment on Consumer Loans assigned under our Purchase Program.
(3) | The Dealer Loans amount represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program. The Purchased Loans amount represents one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program.
Credit Quality We monitor and evaluate the credit quality of Consumer Loans assigned under our Portfolio and Purchase Programs on a monthly basis by comparing our current forecasted collection rates to our initial expectations. For additional information regarding credit quality, see Note 2 to the consolidated financial statements. The following table compares our forecast of Consumer Loan collection rates as of December 31, 2014, with the forecasts as of December 31, 2013, as of December 31, 2012, and at the time of assignment, segmented by year of assignment:
|  | Forecasted Collection Percentage as of (1) |  | Variance in Forecasted Collection Percentage from
Consumer Loan Assignment Year |  | December 31, 2014 |  | December 31, 2013 |  | December 31, 2012 |  | Initial Forecast |  | December 31, 2013 |  | December 31, 2012 |  | Initial Forecast
2005 |  | 73.7 | % |  | 73.7 | % |  | 73.6 | % |  | 74.0 | % |  | — | % |  | 0.1 | % |  | (0.3 | )%
2006 |  | 70.0 | % |  | 70.0 | % |  | 69.9 | % |  | 71.4 | % |  | — | % |  | 0.1 | % |  | (1.4 | )%
2007 |  | 68.0 | % |  | 67.9 | % |  | 68.0 | % |  | 70.7 | % |  | 0.1 | % |  | — | % |  | (2.7 | )%
2008 |  | 70.3 | % |  | 70.1 | % |  | 70.3 | % |  | 69.7 | % |  | 0.2 | % |  | — | % |  | 0.6 | %
2009 |  | 79.4 | % |  | 79.2 | % |  | 79.5 | % |  | 71.9 | % |  | 0.2 | % |  | (0.1 | )% |  | 7.5 | %
2010 |  | 77.2 | % |  | 77.0 | % |  | 77.3 | % |  | 73.6 | % |  | 0.2 | % |  | (0.1 | )% |  | 3.6 | %
2011 |  | 74.0 | % |  | 74.1 | % |  | 74.1 | % |  | 72.5 | % |  | (0.1 | )% |  | (0.1 | )% |  | 1.5 | %
2012 |  | 73.4 | % |  | 73.5 | % |  | 72.2 | % |  | 71.4 | % |  | (0.1 | )% |  | 1.2 | % |  | 2.0 | %
2013 |  | 73.7 | % |  | 73.3 | % |  | — |  |  | 72.0 | % |  | 0.4 | % |  | — |  |  | 1.7 | %
2014 |  | 72.6 | % |  | — |  |  | — |  |  | 71.8 | % |  | — |  |  | — |  |  | 0.8 | %
(1) | Represents the total forecasted collections we expect to collect on the Consumer Loans as a percentage of the repayments that we were contractually owed on the Consumer Loans at the time of assignment. Contractual repayments include both principal and interest.
Advances paid to Dealers on Consumer Loans assigned under our Portfolio Program and one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program are aggregated into pools for purposes of recognizing revenue and evaluating impairment. As a result of this aggregation, we are not able to segment the carrying value of the majority of our Loan portfolio by year of assignment. We are able to segment our Loan portfolio by the performance of the Loan pools. Performance considers both the amount and timing of expected net cash flows and is measured by comparing the balance of the Loan pool to the discounted value of the expected future net cash flows of each Loan pool using the yield established at the time of assignment. The following table segments our Loan portfolio by the performance of the Loan pools:
(In millions) | As of December 31, 2014
| Loan Pool Performance Meets or Exceeds Initial Estimates |  | Loan Pool Performance Less than Initial Estimates
| Dealer Loans |  | Purchased Loans |  | Total |  | Dealer Loans |  | Purchased Loans |  | Total
Loans receivable | $ | 945.1 |  |  | $ | 317.7 |  |  | $ | 1,262.8 |  |  | $ | 1,444.7 |  |  | $ | 12.3 |  |  | $ | 1,457.0 |
Allowance for credit losses | — |  |  | — |  |  | — |  |  | (198.1 | ) |  | (8.8 | ) |  | (206.9 | )
Loans receivable, net | $ | 945.1 |  |  | $ | 317.7 |  |  | $ | 1,262.8 |  |  | $ | 1,246.6 |  |  | $ | 3.5 |  |  | $ | 1,250.1 |
(In millions) | As of December 31, 2013
| Loan Pool Performance Meets or Exceeds Initial Estimates |  | Loan Pool Performance Less than Initial Estimates
| Dealer Loans |  | Purchased Loans |  | Total |  | Dealer Loans |  | Purchased Loans |  | Total
Loans receivable | $ | 681.4 |  |  | $ | 227.3 |  |  | $ | 908.7 |  |  | $ | 1,474.1 |  |  | $ | 25.4 |  |  | $ | 1,499.5 |
Allowance for credit losses | — |  |  | — |  |  | — |  |  | (185.7 | ) |  | (9.7 | ) |  | (195.4 | )
Loans receivable, net | $ | 681.4 |  |  | $ | 227.3 |  |  | $ | 908.7 |  |  | $ | 1,288.4 |  |  | $ | 15.7 |  |  | $ | 1,304.1 |
A summary of changes in the allowance for credit losses is as follows:
(In millions) | For the Year Ended December 31, 2014
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 185.7 |  |  | $ | 9.7 |  |  | $ | 195.4 |
Provision for credit losses | 13.7 |  |  | (0.9 | ) |  | 12.8 |
Write-offs | (3.1 | ) |  | (0.1 | ) |  | (3.2 | )
Recoveries (1) | 1.8 |  |  | 0.1 |  |  | 1.9 |
Balance, end of period | $ | 198.1 |  |  | $ | 8.8 |  |  | $ | 206.9 |
(In millions) | For the Year Ended December 31, 2013
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 167.4 |  |  | $ | 9.0 |  |  | $ | 176.4 |
Provision for credit losses | 21.3 |  |  | 0.6 |  |  | 21.9 |
Write-offs | (5.2 | ) |  | (0.1 | ) |  | (5.3 | )
Recoveries (1) | 2.2 |  |  | 0.2 |  |  | 2.4 |
Balance, end of period | $ | 185.7 |  |  | $ | 9.7 |  |  | $ | 195.4 |
(In millions) | For the Year Ended December 31, 2012
| Dealer Loans |  | Purchased Loans |  | Total
Balance, beginning of period | $ | 141.7 |  |  | $ | 12.6 |  |  | $ | 154.3 |
Provision for credit losses | 27.1 |  |  | (3.1 | ) |  | 24.0 |
Write-offs | (3.6 | ) |  | (0.6 | ) |  | (4.2 | )
Recoveries (1) | 2.2 |  |  | 0.1 |  |  | 2.3 |
Balance, end of period | $ | 167.4 |  |  | $ | 9.0 |  |  | $ | 176.4 |
(1) | Represents collections received on previously written off Loans.
During the fourth quarter of 2014, we enhanced our methodologies for forecasting the timing of future collections on Loans and the timing of future Dealer Holdback payments on Dealer Loans through the utilization of more recent data, different segmentations and new forecast variables. Implementation of the enhanced forecasting methodologies decreased the provision for credit losses by $2.9 million for the fourth quarter of 2014, of which all related to Dealer Loans. During the second quarter of 2013, we enhanced our methodology for forecasting future collections on Loans through the utilization of more recent data, different segmentations and new forecast variables. Implementation of the enhanced forecasting methodology increased the provision for credit losses by $3.0 million for the second quarter of 2013, of which $1.2 million related to Dealer Loans and $1.8 million related to Purchased Loans. During the fourth quarter of 2012, we enhanced the computations used to account for Dealer Loans. The enhanced computations utilize a more sophisticated approach for determining the yields established at the time of assignment, future net cash flow streams and the present value of future cash flow streams. While the enhanced computations did not change these estimates significantly at the overall Dealer Loan portfolio level, we believe they improved the precision of these estimates at the individual Dealer level. Implementation of the enhanced computations increased the provision for credit losses and finance charges by $2.8 million and $0.8 million, respectively, for the year ended December 31, 2012.

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.3,4) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 3, 4 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=28368275&loc=d3e5074-111524 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=28368275&loc=d3e5066-111524 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 03 -Paragraph 7 -Article 9 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(k)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph k -Article 4 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section 50 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=28368275&loc=d3e5162-111524 + Details
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