Union Acceptance Corporation Closes Residual Funding Facility

    INDIANAPOLIS--April 10, 2002--Union Acceptance Corporation ("UAC") today announced that its subsidiary, UAC Funding Facility Corporation, has closed a $55 million residual funding facility with Wachovia Bank, National Association.
    Over a year ago, management initiated an orderly process to restructure and recapitalize the Company. In June 2001, UAC raised $88 million in equity through an oversubscribed rights offering which was the first phase in the Company's strategic long-term capital plan. As part of the second phase, on April 5, 2002, UAC closed the $55 million residual funding facility.
    "This facility further strengthens our financial position and future liquidity," commented Lee Ervin, President and Chief Operating Officer. "This facility is a significant component of our plan to meet our objective of making UAC highly profitable and one of the most soundly capitalized companies in the independent auto finance industry."
    Rick Brown, Chief Financial Officer stated, "We are pleased with Wachovia's commitment to UAC as demonstrated by this facility. This will be a key component in our plans to posture the Company in line with our desired capital structure."
    UAC intends to utilize the facility to repay term debt that is maturing over the next year. First Union Securities, Inc. will serve as Structuring Agent and Deal Agent for this facility.
    For information about Union Acceptance Corporation, please visit the Company's website at www.unionacceptance.com.

    Corporate Description

    UAC is one of the nation's largest independent, indirect automobile finance companies. The Company's primary business is purchasing and servicing prime automobile retail installment sales contracts. These contracts are originated by dealerships affiliated with major domestic and foreign manufacturers, nationally recognized rental car outlets, and used car superstores. UAC focuses on acquiring receivables related to late model used and, to a lesser extent, new automobiles purchased by customers who exhibit favorable credit profiles. Union Acceptance Corporation commenced business in 1986 and currently acquires receivables from over 5,800 manufacturer-franchised dealerships in 40 states. By using state-of-the-art technology in a highly centralized underwriting and servicing environment, Union Acceptance Corporation enjoys one of the lowest cost operating structures in the independent prime automobile finance industry.

    Forward Looking Information

    This news release contains forward-looking statements regarding matters such as profitability, receivable acquisitions, adequacy of credit arrangements, delinquency and credit loss trends and estimates, and other issues. Readers are cautioned that actual results may differ materially from such forward-looking statements. Forward-looking statements involve risks and uncertainties including, but not limited to, the difficulty inherent in predicting changes in delinquency and credit loss rates, changes in acquisition volume, general economic conditions that affect consumer loan performance and consumer borrowing practices and other important factors detailed in the Company's annual report on Form 10-K for the six months ended December 31, 2001 which was filed with the Securities and Exchange Commission.