S&P Asgns Household Auto Tr 2002-1 Ser 2002-1 Nt Rtgs

    NEW YORK--Standard & Poor's--May 31, 2002--Standard & Poor's assigned its ratings to Household Automotive Trust 2002-1's (Household) $1 billion auto receivable asset-backed notes (see list).
    The ratings reflect the credit support available to the notes, the performance of Household Finance Corp.'s (HFC) auto loan receivables portfolio, prior securitizations, and a sound legal structure.
    Credit support available to the noteholders is composed of the full guarantee of timely interest and the ultimate repayment of principal of the notes from MBIA Insurance Corp. (triple-'A' insurer financial strength rating), overcollateralization, a reserve account (partially funded at closing) and excess spread. Standard & Poor's determined that the transaction is of investment-grade quality before issuance of the policy.
    As in recent transactions, the class A-1 through A-4 notes will receive interest on a pro rata basis and principal sequentially. In addition to the bond insurance provided by MBIA, credit enhancement begins at 7.0% of the initial pool balance, consisting of a 1.0% reserve account balance that grows to 3.0% of current, with a 2.0% of initial floor, and 6.0% in overcollateralization, building to 9.5% of current, resulting in a targeted total credit enhancement of 12.5% of the outstanding pool balance. As with previous Household transactions, the servicing fee will be subordinated while HFC is acting as servicer.
    Standard & Poor's reviewed the collateral characteristics and believes this pool of loans to be of a comparable credit quality to recent securitized pools. The loans consist of subprime retail installment sales contracts secured by 21% new and 79% used automobiles, light duty trucks and vans. The receivables pool is made up of 71,769 auto loans. The originator targets obligors with limited or no credit history, modest income, or obligors who have experienced prior credit difficulties.
    The primary originator and servicer of the receivables is HFC, the auto finance subsidiary of Household International Inc. (single-'A'/Stable), a leading consumer finance company. On March 31, 2002, HFC's serviced portfolio consisted of 506,831 contracts, totaling approximately $6.6 billion.

RATINGS ASSIGNED
Household Automotive Trust 2002-1 Series 2002-1 Notes

Class                                Rating      Amount (Mil. $)
Class A-1 1.87% money market notes   A-1+                   22.9
Class A-2 2.75% notes                AAA                    26.7
Class A-3 3.75% notes                AAA                    28.6
Class A-4 4.39% notes                AAA                    21.8