Another Subprime Lender Files for Bankruptcy

Primalend Files Chapter 11. Defaulting on Bond Payments

Plano, TX – October 22, 2025 – Last month, the bankruptcy filing of Tricolor sent fears of an oncoming subprime lending crash rippling across the country. With baited breath, many were waiting to see who would be next, if anyone. On Wednesday the 21^st, that question was answered as subprime lender PrimaLend Capital Partners LP filed for chapter 11 bankruptcy.

PrimaLend provides financing to consumer and specialty lenders through asset-based credit facilities. It also serves the “buy-here-pay-here” auto financing market, where dealers sell and directly finance vehicles for customers with poor or limited credit.

Last month, Bloomberg News reported that PrimaLend’s creditors were weighing pushing the firm into bankruptcy after going unpaid for several months.

The Plano-based company has been providing financing for auto dealerships across the US since 2007. In its chapter 11 bankruptcy filed in the U.S. Bankruptcy Court for the Northern District of Texas, PrimaLend and its two affiliates; Good Floor Loans LLC and LNCMJ Management LLC, reported between $100 million and $500 million in both assets and liabilities, with up to 1,000 creditors affected.

Despite this, Primalend issued a press release stating:

“We want to be clear: there is no impact to our dealer-borrowers’ loans or terms. No debt is being called due or accelerated as a result of this process,” said Mark Jensen, CEO of PrimaLend. “We are pursuing a sale process to maximize value of the business and strengthen our balance sheet in order to position PrimaLend for long-term success. We believe this is the best path forward to secure a strong financial future while maintaining our commitment to dealer-borrower success.”

The company’s restructuring plan has been assigned to the Texas bankruptcy court where it will attempt to balance their creditor demands with the hope of salvaging its operations through a court-approved sale. It is stated that even unsecured creditors can expect some disbursements from the sale, but how much and who gets priority will be at the mercy of the trustees and the court.

While we have yet to see the creditors list, it is possible that numerous repossession agencies and transporters could be effected.

In recent weeks following the bankruptcy filing of Tricolor, there has been heightened interest in the high repossession volumes over the year. With this bankruptcy filing, expect the flames of financial meltdown fears in the subprime market to only intensify.

Hundreds of Repo Agencies Listed in Tricolor Bankruptcy