What changed in this filing

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Item 1. Financial Statements

2022-11-14 compared with 2022-08-08 · 221 added, 185 removed, 684 unchanged (37% of the section changed)

4 unchanged sentences

(In thousands, except share and per share data)

September 30,

Cash and cash equivalents

24 unchanged sentences

authorized 75,000,000 shares;

21,206,839 and 21,143,764 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively

20,607,286 and 21,143,764 shares issued

and outstanding at September 30, 2022 and December 31, 2021, respectively

Retained earnings

10 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Interest income

6 unchanged sentences

Total operating expenses

Income before income tax expense (benefit)

Income tax expense (benefit)

Income before income tax expense

Income tax expense

Earnings per share:

8 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Other comprehensive income/(loss);

8 unchanged sentences

(In thousands)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities:

7 unchanged sentences

Stock-based compensation expense

Purchases of finance receivables held-for-sale

Sale of finance receivables held-for-sale

Changes in assets and liabilities:

6 unchanged sentences

Purchases of finance receivables measured at fair value

( 1,311,735 )

Payments received on finance receivables at fair value

1 unchanged sentence

Purchase of furniture and equipment

Net cash provided by (used in) investing activities

Net cash used in investing activities

Cash flows from financing activities:

13 unchanged sentences

Supplemental disclosure of cash flow information:

Cash paid (received) during the period for:

Cash paid during the period for:

See accompanying Notes to Unaudited Condensed

5 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Common Stock (Shares Outstanding)

18 unchanged sentences

Total Shareholders' Equity

See accompanying Notes to Unaudited Condensed

Consolidated Financial Statements.

CONSUMER PORTFOLIO SERVICES, INC.

23 unchanged sentences

in the opinion of management, of a normal recurring nature.

Results for the six-month period ended June 30, 2022 are not necessarily indicative

of the operating results to be expected for the full year.

Results for the nine-month period ended September 30, 2022 are not necessarily

indicative of the operating results to be expected for the full year.

Certain information and footnote disclosures normally

29 unchanged sentences

would be required.

Results for the three-month and six-month periods ending June 30, 2022 include a $ 4.7 million and $ 7.1 million positive

mark to the carrying value of the portion of the receivables portfolio accounted for at fair value.

Mark downs of $ 4.4 million were included

in the results for the six months ending June 30, 2021, and the mark down is reflected as a reduction in revenue.

Results for the three-month and nine-month periods ending September 30, 2022 include a $ 8.2 million and $ 15.3 million

positive mark to the carrying value of the portion of the receivables portfolio accounted for at fair value.

Mark downs of $ 4.4 million

were included in the results for the nine months ending September 30, 2021.

Mark downs are reflected as a reduction in revenue.

Anticipated credit losses are included in our

8 unchanged sentences

recognize the costs of acquisition as expenses in the period incurred.

The following

table presents the primary components of Other Income for the three-month and six-month periods ending June 30, 2022 and 2021:

The following table presents the primary components

of Other Income for the three-month and nine-month periods ending September 30, 2022 and 2021:

Schedule of other income

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In thousands)

6 unchanged sentences

Other income for the period

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

The Company has operating leases for corporate

7 unchanged sentences

sheet and the related lease expense is recognized on a straight-line basis over the lease term.

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

The following table presents

1 unchanged sentence

Supplemental balance sheet information related to leases

September 30,

(In thousands)

12 unchanged sentences

Finance lease

Schedule of maturities of lease liabilities

Maturities of lease liabilities were as follows:

Schedule of maturities of lease liabilities

(In thousands)

Year Ending June 30,

Year Ending September 30,

Total undiscounted lease payments

8 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In thousands)

7 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Cash paid for amounts included in the measurement of lease liabilities:

8 unchanged sentences

Compensation”.

For the three and six months ended June 30, 2022,

we recorded stock-based compensation costs in the amount of $ 1.5 million and $ 728,000 , respectively.

These stock-based compensation costs

were $ 327,000 and $ 735,000 for the three and six months ended June 30, 2021.

As of June 30, 2022, unrecognized stock-based compensation

costs to be recognized over future periods equaled $ 12.4 million.

This amount will be recognized as expense over a weighted-average period

of 2.7 years.

For the three and nine months ended September

30, 2022, we recorded stock-based compensation costs in the amount of $ 1.4 million and $ 3.0 million , respectively.

These stock-based compensation

costs were $ 530,000 and $ 1.3 million for the three and nine months ended September 30, 2021.

As of September 30, 2022, unrecognized stock-based

compensation costs to be recognized over future periods equaled $ 10.9 million .

This amount will be recognized as expense over a weighted-average

period of 2.6 years.

CONSUMER PORTFOLIO SERVICES, INC.

2 unchanged sentences

The following represents stock option activity

for the six months ended June 30, 2022:

for the nine months ended September 30, 2022:

Share-based payment arrangement option activity

1 unchanged sentence

Exercise Price

Contractual Term

Options outstanding at the beginning of period

2 unchanged sentences

The following table presents the price distribution

of stock options outstanding and exercisable as of June 30, 2022 and December 31, 2021:

of stock options outstanding and exercisable as of September 30, 2022 and December 31, 2021:

Schedule of stock options outstanding and exercisable

1 unchanged sentence

Number of shares as of

June 30, 2022

September 30, 2022

December 31, 2021

10 unchanged sentences

$8.00 - $11.00

At June 30, 2022 the aggregate intrinsic value

of options outstanding and exercisable was $ 57.8 million and $ 42.1 million, respectively.

There were 2.9 million options exercised for

the six months ended June 30, 2022 compared to 676,000 for the comparable period in 2021.

The total intrinsic value of options exercised

was $ 12.2 million and $ 1.9 million for the six-month periods ended June 30, 2022 and 2021.

There were 2,661,000 shares available for future

stock option grants under existing plans as of June 30, 2022.

At September 30, 2022 the aggregate intrinsic

value of options outstanding and exercisable was $ 29.2 million and $ 22.7 million , respectively.

There were 2,974,223 million options exercised for the nine months ended September 30, 2022 compared to 1,054,541 for the comparable period in 2021.

The total intrinsic value of options

exercised was $ 23.1 million and $ 3.0 million for the nine-month periods ended September 30, 2022 and 2021.

There were 2,691,000 shares

available for future stock option grants under existing plans as of September 30, 2022.

CONSUMER PORTFOLIO SERVICES, INC.

3 unchanged sentences

The table below describes the purchase of our

common stock for the six months ended June 30, 2022 and 2021:

common stock for the nine-month ended September 30, 2022 and 2021:

Schedule of purchases of company stock

Six Months Ended

June 30, 2022

June 30, 2021

Nine Months Ended

September 30, 2022

September 30, 2021

Open market purchases

10 unchanged sentences

Such covenants include maintaining minimum levels of liquidity and net worth and not exceeding maximum leverage

As of June 30, 2022, we were in compliance with all such covenants.

In addition, certain of our debt agreements other than our

term securitizations contain cross-default provisions.

Such cross-default provisions would allow the respective creditors to declare a

default if an event of default occurred with respect to other indebtedness of ours, but only if such other event of default were to be

accompanied by acceleration of such other indebtedness.

As of September 30, 2022, we were in compliance with all such covenants.

In addition, certain of our debt agreements other than

our term securitizations contain cross-default provisions.

Such cross-default provisions would allow the respective creditors to declare

a default if an event of default occurred with respect to other indebtedness of ours, but only if such other event of default were to

be accompanied by acceleration of such other indebtedness.

Provision for Contingent

3 unchanged sentences

is both probable that a liability has been incurred and the amount of the loss can be reasonably determined.

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

(2) Finance Receivables

9 unchanged sentences

Any payments received on a contract that is greater than 90 days delinquent are first applied to accrued interest and then to principal

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

In January 2018 the Company

2 unchanged sentences

recorded separately on the Company’s Balance Sheet and are excluded from all tables in this footnote.

We consider an automobile contract delinquent

when an obligor fails to make at least 90% of a contractually due payment by the following due date, which date may have been extended

within limits specified in the servicing agreements.

We consider an automobile contract

delinquent when an obligor fails to make at least 90% of a contractually due payment by the following due date, which date may have been

extended within limits specified in the servicing agreements.

The period of delinquency is based on the number of days payments are contractually

11 unchanged sentences

Automobile finance receivables, net of unearned interest was $ 116.7

million and $ 232.4 million as of June

million and $ 232.4 million as of September

30, 2022 and December 31, 2021, respectively.

The following table summarizes the delinquency status of finance receivables as of June

The following table summarizes the delinquency status of finance receivables as of September

30, 2022 and December 31, 2021:

Schedule of delinquency status of finance receivables

September 30,

(In thousands)

1 unchanged sentence

Finance receivables totaling

$ 2.2 million and $ 2.7 million at June 30, 2022 and December 31, 2021, respectively, including all receivables greater than 90 days delinquent,

have been placed on non-accrual status as a result of their delinquency status.

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

$ 2.5 million and $ 2.7 million at September 30, 2022 and December 31, 2021, respectively, including all receivables greater than 90 days

delinquent, have been placed on non-accrual status as a result of their delinquency status.

Allowance for Credit Losses

26 unchanged sentences

between various segments of our portfolio.

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

Our methodology incorporates

8 unchanged sentences

factors may affect future credit losses and have incorporated our judgement of the effect of such factors into our estimates.

The following table presents the amortized cost

basis of our finance receivables by annual vintage as of June 30, 2022 and 2021.

The following table presents

the amortized cost basis of our finance receivables by annual vintage as of September 30, 2022 and December 31, 2021.

Schedule of amortized cost basis of finance receivables

September 30,

(In thousands)

1 unchanged sentence

2012 and prior

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

The following table presents a summary of the

activity for the allowance for finance credit losses for the three-month periods ended June 30, 2022 and 2021:

activity for the allowance for finance credit losses for the three-month and nine-month periods ended September 30, 2022 and 2021:

Schedule of allowance for finance credit losses

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In thousands)

3 unchanged sentences

Balance at end of period

Excluded from finance receivables are contracts

that were previously classified as finance receivables but were reclassified as other assets because we have repossessed the vehicle

securing the Contract.

The following table presents a summary of such repossessed inventory together with the allowance for losses in

repossessed inventory that is not included in the allowance for finance credit losses:

Excluded from finance receivables are contracts that were previously

classified as finance receivables but were reclassified as other assets because we have repossessed the vehicle securing the Contract.

The following table presents a summary of such repossessed inventory together with the allowance for losses in repossessed inventory

that is not included in the allowance for finance credit losses:

Schedule of allowance for losses on repossessed inventory

September 30,

(In thousands)

6 unchanged sentences

(3) Securitization Trust Debt

We have completed many securitization transactions

that are structured as secured borrowings for financial accounting purposes.

The debt issued in these transactions is shown on our Unaudited

Condensed Consolidated Balance Sheets as “Securitization trust debt,” and the components of such debt are summarized in the

following table:

We have completed many securitization

transactions that are structured as secured borrowings for financial accounting purposes.

The debt issued in these transactions is shown

on our Unaudited Condensed Consolidated Balance Sheets as “Securitization trust debt,” and the components of such debt are

summarized in the following table:

Schedule of Long-term Debt Instruments

Average Contractual

Interest Rate

Contractual Debt

Interest Rate at

September 30,

(Dollars in thousands)

21 unchanged sentences

Debt issuance costs of $ 14.1

million and $ 12.0 million as of June 30, 2022 and December 31, 2021, respectively, have been excluded from the table above.

issuance costs are presented as a direct deduction to the carrying amount of the Securitization trust debt on our Consolidated Balance

million and $ 12.0 million as of September 30, 2022 and December 31, 2021, respectively, have been excluded from the table above.

debt issuance costs are presented as a direct deduction to the carrying amount of the Securitization trust debt on our Consolidated Balance

All of the securitization trust

6 unchanged sentences

of liquidity and not exceed maximum leverage levels.

As of June 30, 2022, we were in compliance with all such covenants.

As of September 30, 2022, we were in compliance with all such covenants.

We are responsible for the administration

3 unchanged sentences

proceeds from a term securitization prior to the purchase of additional collateral.

As of June 30, 2022, restricted cash under the various

agreements totaled approximately $ 157.0 million.

Interest expense on the securitization trust debt consists of the stated rate of interest

plus amortization of additional costs of borrowing.

Additional costs of borrowing include facility fees, amortization of deferred financing

costs and discounts on notes sold.

Deferred financing costs and discounts on notes sold related to the securitization trust debt are amortized

using a level yield method.

Accordingly, the effective cost of the securitization trust debt is greater than the contractual rate of interest

disclosed above.

As of September 30, 2022, restricted cash under the

various agreements totaled approximately $ 159.8 million .

Interest expense on the securitization trust debt consists of the stated rate

of interest plus amortization of additional costs of borrowing.

Additional costs of borrowing include facility fees, amortization of deferred

financing costs and discounts on notes sold.

Deferred financing costs and discounts on notes sold related to the securitization trust

debt are amortized using a level yield method.

Accordingly, the effective cost of the securitization trust debt is greater than the contractual

rate of interest disclosed above.

Our wholly-owned bankruptcy remote subsidiaries

9 unchanged sentences

None of the assets of these subsidiaries are available to pay other creditors.

The terms and amounts of our other debt outstanding

at June 30, 2022 and December 31, 2021 are summarized below:

The terms and amounts of our

other debt outstanding at September 30, 2022 and December 31, 2021 are summarized below:

Schedule of debt outstanding

Amount Outstanding at

September 30,

(In thousands)

6 unchanged sentences

Subordinated renewable notes

Weighted average rate of 7.97% and 8.93% at June 30, 2022 and December 31, 2021, respectively

Weighted average maturity of June

2024 and January

2024 at June 30, 2022 and December 31, 2021, respectively

Weighted average rate of 7.67 % and 8.93 % at September 30, 2022 and December 31, 2021, respectively

Weighted average maturity of July 2024 and January 2024 at September 30, 2022

and December 31, 2021, respectively

CONSUMER PORTFOLIO SERVICES, INC.

1 unchanged sentence

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

On February 2, 2022, we renewed our two-year revolving credit agreement with Ares Agent Services, L.P.

was $ 130.8 million outstanding under this facility at June 30, 2022.

On June 28, 2022, we increased the capacity of its credit agreement

with Ares Agent Services, L.P.

On February 2, 2022, we renewed our two-year revolving

credit agreement with Ares Agent Services, L.P.

There was $ 106.9 million outstanding under this facility at September 30, 2022.

28, 2022, we increased the capacity of its credit agreement with Ares Agent Services, L.P.

from $ 100 million to $ 200 million .

The revolving period for this facility was extended to January 2024

followed by an amortization period through January 2028 for any receivables pledged at the end of the revolving period.

The revolving

period for this facility was extended to January 2024 followed by an amortization period through January 2028 for any receivables pledged

at the end of the revolving period.

On July 15, 2022, we renewed our two-year revolving

credit agreement with Citibank, N.A., and doubled the capacity from $ 100 million to $ 200 million .

There was $ 138.6 million outstanding

under this facility at September 30, 2022.

The revolving period for this facility was extended to July 2024 followed by an amortization

period through July 2025 for any receivables pledged at the end of the revolving period

Unamortized debt issuance costs of $ 440 ,000 and

$ 629,000 as of June 30, 2022 and December 31, 2021, respectively, have been excluded from the amount reported above for residual interest

Similarly, unamortized debt issuance costs of $ 1.7 million and $ 400,000 as of June 30, 2022 and December 31, 2021, respectively,

have been excluded from the Warehouse lines of credit amounts in the table above.

These debt issuance costs are presented as a direct

deduction to the carrying amount of the debt on our Unaudited Condensed Consolidated Balance Sheets.

$ 629 ,000 as of September 30, 2022 and December 31, 2021, respectively, have been excluded from the amount reported above for residual

interest financing.

Similarly, unamortized debt issuance costs of $ 3.0 million and $ 400 ,000 as of September 30, 2022 and December 31,

2021, respectively, have been excluded from the Warehouse lines of credit amounts in the table above.

These debt issuance costs are presented

as a direct deduction to the carrying amount of the debt on our Unaudited Condensed Consolidated Balance Sheets.

(5) Interest Income and Interest Expense

2 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In thousands)

8 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In thousands)

9 unchanged sentences

(6) Earnings Per Share

Earnings per share for the three-month and six-month

periods ended June 30, 2022 and 2021 were calculated using the weighted average number of shares outstanding for the related period.

The following table reconciles the number of shares used in the computations of basic and diluted earnings per share for the three-month

and six-month periods ended June 30, 2022 and 2021:

Earnings per share for the

three-month and nine-month periods ended September 30, 2022 and 2021 were calculated using the weighted average number of shares outstanding

for the related period.

The following table reconciles the number of shares used in the computations of basic and diluted earnings per

share for the three-month and nine-month periods ended September 30, 2022 and 2021:

Computation of earnings per share

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In thousands)

3 unchanged sentences

Weighted average number of common shares used to compute diluted earnings per share

If the anti-dilutive effects of common stock

equivalents were considered, shares included in the diluted earnings per share calculation for the three-month and six-month periods

ended June 30, 2022 would have included an additional 824,000 and 692,000 shares, respectively, attributable to the exercise of outstanding

options and warrants.

For the three-month and six-month periods ended June 30, 2021, an additional 6 .0 million and 6.9 million shares,

respectively, would be included in the diluted earnings per share calculation.

If the anti-dilutive effects

of common stock equivalents were considered, shares included in the diluted earnings per share calculation for the three-month and nine-month

periods ended September 30, 2022 would have included an additional 1.7 million and 1.0 million shares, respectively, attributable to the

exercise of outstanding options and warrants.

For the three-month and nine-month periods ended September 30, 2021, an additional 5.6 million

and 5.8 million shares, respectively, would be included in the diluted earnings per share calculation.

(7) Income Taxes

3 unchanged sentences

state, or local examinations by tax authorities for years before 2015.

As of June 30, 2022, and December

31, 2021, we had no unrecognized tax benefits for uncertain tax positions.

We do not anticipate that total unrecognized tax benefits will

significantly change due to any settlements of audits or expirations of statutes of limitations over the next 12 months.

As of September 30, 2022, and

December 31, 2021, we had no unrecognized tax benefits for uncertain tax positions.

We do not anticipate that total unrecognized tax benefits

will significantly change due to any settlements of audits or expirations of statutes of limitations over the next 12 months.

The Company and its subsidiaries

16 unchanged sentences

Although realization

is not assured, we believe that the realization of the recognized net deferred tax asset of $ 17,523 17.5 million as of June 30, 2022 is more

likely than not based on forecasted future net earnings.

Our net deferred tax asset of $17.5 million consists of approximately $ 10.5 million

is not assured, we believe that the realization of the recognized net deferred tax asset of $ 14.6 million as of September 30, 2022 is

more likely than not based on forecasted future net earnings.

Our net deferred tax asset of $14.6 million consists of approximately $ 8.3

million of net U.S.

federal deferred tax assets and $ 6.3 million of net state deferred tax assets.

Income tax expense was $ 8.9

million and $ 17.1 million for the three months and six months ended June 30, 2022, representing effective income tax rates of 26 % and

27 %, respectively, compared to income tax expense of $ 4.2 million and $ 6.9 million for the three months and six months ended June 30,

million and $ 26.0 million for the three months and nine months ended September 30, 2022, representing effective income tax rates of 26 %

and 27 %, respectively, compared to income tax expense of $ 5.9 million and $ 12.8 million for the three months and nine months ended September

30, 2021, and represents an effective income tax rates of 30 % and 31 % respectively.

37 unchanged sentences

At this time, it is not possible to determine any amount of loss that is probable and measurable.

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

be no assurance as to the outcomes of the matters described or referenced above.

We record at each measurement date, most recently as

of June 30, 2022, our best estimate of probable incurred losses for legal contingencies, including the matters identified above, and consumer

of September 30, 2022, our best estimate of probable incurred losses for legal contingencies, including the matters identified above,

and consumer claims.

The amount of losses that may ultimately be incurred cannot be estimated with certainty.

However, based on such information as

is available to us, we believe that the total of probable incurred losses for legal contingencies as of June 30, 2022 is $3.4 million,

and that the range of reasonably possible losses for the legal proceedings and contingencies we face, including those described or identified

above, as of June 30, 2022 does not exceed $11.3 million.

However, based on such information

as is available to us, we believe that the total of probable incurred losses for legal contingencies as of September 30, 2022 is $3.4

million, and that the range of reasonably possible losses for the legal proceedings and contingencies we face, including those described

or identified above, as of September 30, 2022 does not exceed $11.3 million.

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

Accordingly, we believe that

35 unchanged sentences

and the rate of amortization of the portfolio of finance receivable.

Significant changes in any of those inputs in isolation would have

a significant effect on our fair value measurement.

For the quarter ended June

Significant changes in any of those

inputs in isolation would have a significant effect on our fair value measurement.

For the quarter ended September

30, 2022, the Company evaluated the appropriate fair value and future earnings rate of existing receivables compared to recently acquired

1 unchanged sentence

and did not record a mark down to that portfolio.

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

The table below presents a reconciliation of

the finance receivables measured at fair value on a recurring basis using significant unobservable inputs:

The table below presents a

reconciliation of the finance receivables measured at fair value on a recurring basis using significant unobservable inputs:

Schedule of reconciliation of the finance receivables measured at fair value on a recurring basis

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In thousands)

6 unchanged sentences

Balance at end of period

The table below compares the fair values of these

finance receivables to their contractual balances for the periods shown:

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

The table below compares the

fair values of these finance receivables to their contractual balances for the periods shown:

Finance receivables fair and contractual balances

June 30, 2022

September 30, 2022

December 31, 2021

1 unchanged sentence

Finance receivables measured at fair value

The following table provides certain qualitative

information about our level 3 fair value measurements:

The following table provides

certain qualitative information about our level 3 fair value measurements:

Schedule of level 3 fair value measurements

1 unchanged sentence

Fair Values as of

September 30,

Unobservable Inputs

2 unchanged sentences

Discount rate

10.6% - 11.3%

Cumulative net losses

1 unchanged sentence

10.0% - 18.4%

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

The following table summarizes the delinquency

status of these finance receivables measured at fair value as of June 30, 2022 and December 31, 2021:

The following table summarizes

the delinquency status of these finance receivables measured at fair value as of September 30, 2022 and December 31, 2021:

Schedule of delinquency status of finance receivables measured at fair value

September 30,

(In thousands)

3 unchanged sentences

based on our actual loss experience on sale of repossessed vehicles.

At June 30, 2022 the finance receivables related to the repossessed

At September 30, 2022 the finance receivables related to the repossessed

vehicles in inventory totaled $2.3 million.

We have applied a valuation adjustment, or loss allowance, of $1.5 million, which is based

on a recovery rate of approximately 47%, resulting in an estimated fair value and carrying amount of $ 1.4 million.

The fair value and

carrying amount of the repossessed inventory at December 31, 2021 was $ 2.4 million after applying a valuation adjustment of $ 1.9 million.

on a recovery rate of approximately 34%, resulting in an estimated fair value and carrying amount of $776,000.

The fair value and carrying

amount of the repossessed inventory at December 31, 2021 was $2.4 million after applying a valuation adjustment of $1.9 million.

There were no transfers in

or out of level 1, level 2 or level 3 assets and liabilities for the three months ended June 30, 2022 and 2021.

The estimated fair values of financial assets

and liabilities at June 30, 2022 and December 31, 2021, were as follows:

or out of level 1, level 2 or level 3 assets and liabilities for the three months ended September 30, 2022 and 2021.

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

The estimated fair values of

financial assets and liabilities at September 30, 2022 and December 31, 2021, were as follows:

Schedule of estimated fair values of financial assets and liabilities

As of June 30, 2022

As of September 30, 2022

Financial Instrument

6 unchanged sentences

Warehouse lines of credit

Residual interest financing

Accrued interest payable

1 unchanged sentence

Subordinated renewable notes

CONSUMER PORTFOLIO SERVICES, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL

As of December 31, 2021

7 unchanged sentences

Warehouse lines of credit

Residual interest financing

Accrued interest payable

2 unchanged sentences

(10) Subsequent Events

On July 15, 2022, we renewed our two-year revolving

credit agreement with Citibank, N.A., and doubled the capacity from $100 million to $200 million.

There was $99.9 million outstanding

under this facility at June 30, 2022.

The revolving period for this facility was extended to July 2024 followed by an amortization period

through July 2025 for any receivables pledged at the end of the revolving period.

On August 3, 2022 we executed our third securitization

15 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements