7f7c33a287 4. This Page Intentionally Left Blank . RETAIL SECURITIZATION BREAK-EVEN ANALYSIS Illustration: Approximate Break-Even Cumulative Net Loss for 2012-D* * S&P 2012-D Pre-Sale Report Break-Even for 2012-D Compared With Historical Pool Losses 0% 2% 4% 6% 8% 10% 12% 18% 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 61 63 . Consistent structure for more than 15 years Senior/subordinate, sequential pay structure Credit enhancements in our retail securitization programs are: Subordination of junior notes Cash reserve Excess spread (used to build to a target overcollateralization) RETAIL SECURITIZATION TRANSACTION STRUCTURE % of Initial Adjusted Pool Balance Total Class A Enhancement 9.5% Class A Notes ("AAA") 95.0% Class B Notes ("AA") 3.0% Class C Notes ("A") 2.0% Class D Notes ("BBB") 2.0% Reserve Account 0.5% Excess Spread (per annum) 4.0% Initial Negative Overcollateralization (2.0%) . 333-167489 Ford Credit Auto Receivables Two LLC (the depositor) Ford Credit Auto Owner Trusts (the issuer) This document constitutes a free writing prospectus for purposes of the Securities Act of 1933. ORIGINATIONS, SERVICING AND RISK MANAGEMENT .
RETAIL SECURITIZATION BUSINESS UPDATE Number of Receivables Originated U.S. Free Writing Prospectus Registration Statement No. DISCUSSION AGENDA Business Update 3 Retail Securitization R-1 FCAR ABCP FC-1 Lease Securitization L-1 Floorplan Securitization F-1 1. retail contracts through various channels, including: Public transactions (over 60 since 1989) Private transactions FCAR, our single seller ABCP conduit (since 1996) Collateral composition has trended in line with the industry and Ford Credits strategic focus – we securitize what we originate Structural elements have remained consistent over time – same structure in place for over 15 years RETAIL SECURITIZATION OVERVIEW . Free Writing Prospectus Filed Pursuant to Rule 433 Dated January 25, 2013 Registration Statement No. You may get these documents for free by visiting EDGAR on the SEC Website at www.sec.gov. RETAIL SECURITIZATION PORTFOLIO CREDIT METRICS Weighted Average FICO at Origination Net Losses as a % of the Average Portfolio Outstanding Average Net Loss on Charged-Off Contracts Repossessions as a % of the Average Number of Contracts Outstanding Source: 2012-D Prospectus Supplement 706 710 719 721 730 729 2007 2008 2009 2010 2011 Sep-12 YTD 1.95% 2.39% 3.12% 2.54% 2.05% 1.55% 2007 2008 2009 2010 2011 Sep-12 YTD 0.79% 1.45% 1.53% 0.74% 0.45% 0.25% 2007 2008 2009 2010 2011 Sep-12 YTD average net loss on charged-off contracts $3,892 $6,483 $5,249 $3,047 $2,351 $1,854 2007 2008 2009 2010 2011 sep-12 ytd . FORD CREDIT ORIGINATION STRATEGY Segment credit applicants and price appropriately to manage risk Build strong relationships with dealers and support for automotive brands Robust credit evaluation (proprietary scoring models and judgment) and verification process Buy it Right Operate Efficiently Collect Effectively Fund Efficiently Manage Risks Service Originate Fund . FORD CREDIT SERVICING STRATEGY Ford Credit uses behavioral scorecards to identify predictors and calculate probability of default Factors used in the behavioral scoring models include origination characteristics and scores, updated credit bureau information, and customer history variables, such as payment patterns Probability of Default is the primary driver in determining risk category, which establishes: Assignment timing Follow-up intensity Assignment transfers within the collections area from early stage delinquency, which includes account maintenance, to late stage delinquency, which focuses on loss prevention Ford Credit reviews scorecards regularly to confirm continued business significance and statistical predictability of the variables .
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