PrimaLend’s Bankruptcy Renews Focus on Subprime Consumer Strain

PrimaLend Capital Partners filed for bankruptcy after months of negotiations with creditors following missed interest payments on its debt, the latest sign of stress in a pocket of the US economy catering to low-income consumers.

The Plano, Texas-based provider of financing to auto dealerships focused on subprime borrowers said it was pursuing a sale of the business in bankruptcy court and would continue to fund and service loans to its own borrowers. It also said it has received commitments for bankruptcy financing from existing lenders.