Below-prime auto finance is out of favor with private equity investors. The wave of investments in 2010-12 led to heightened competition and loose underwriting, followed by a spike in delinquencies and losses. The result is a significant decrease in new equity capital available to the sector. While banks that lend to the below-prime auto finance industry are more cautious and selective, senior debt availability remains strong for performing industry participants due, in large part, to the asset-backed securities market.