Fitch Expects to Rate Wachovia Auto Loan Owner Trust 2007-1 'F1+/AAA'

NEW YORK--Fitch Ratings expects to rate Wachovia Auto Loan Owner Trust 2007-1 (WALOT 2007-1) as follows:

--$384,000,000 fixed-rate class A-1 asset-backed notes 'F1+';

--$613,000,000 fixed-rate class A-2 asset-backed notes 'AAA';

--$200,000,000 fixed-rate class A-3a asset-backed notes 'AAA';

--$518,000,000 floating-rate class A-3b asset-backed notes 'AAA';

--$75,000,000 fixed-rate class B asset-backed notes 'AA';

--$80,000,000 fixed-rate class C asset-backed notes 'A';

--$80,000,000 fixed-rate class D asset-backed notes 'BBB';

--$50,000,000 fixed-rate class E asset-backed notes 'BB'.

The securities are backed by a pool of new and used automobile and light-duty truck installment loans originated by Wachovia Dealer Services, Inc. (WDS), Wachovia's auto finance business. The expected ratings on the notes are based on the credit enhancement provided by subordination, over-collateralization (OC), and a reserve account. The expected ratings also reflect the servicing capabilities of Wachovia, the quality of retail auto receivables originated by WDS, and the sound legal and cash flow structures. WALOT 2007-1 represents Wachovia's third securitization of legacy WFS Financial Inc (WFS) collateral subsequent to its purchase of Westcorp and its auto finance business, WFS.

The class A notes have initial credit enhancement (CE) of 14.50 % consisting of 14.25% subordination, and a 0.25% reserve. The class B notes are supported by initial CE of 10.75% (10.50% subordination and a 0.25% reserve). The class C notes have 6.75% CE (6.50% subordination and a 0.25% reserve), the class D notes have 2.75% initial CE (2.50% subordination and a 0.25% reserve) and class E notes have 0.25% initial CE (0.25% reserve). CE is expected to grow to 16.00% for class A; 12.25% for class B, 8.25% for class C, 4.25% for class D, and 1.75% for class E via accumulation of the cash reserve account to 0.50% of the initial pool balance and growing OC to 1.25% of the outstanding pool balance. A cash reserve floor is set to 0.50% of the initial pool balance while the floor for OC is set at 0.50%.

As of the statistical cutoff date, the receivables had a weighted average (WA) APR of 12.42%. The WA original maturity of the pool was 67.3 months and the WA remaining term was 60.5 months resulting in approximately 6.8 months of collateral seasoning. The pool has a large concentration of receivables originated in California (CA) (32.18%) followed by Arizona (5.14%), Washington (5.09%), Texas (4.57%) and Nevada (4.03%). The exposure in CA may subject the pool to potential regional economic downturns; however, the remaining portion of the pool is well diversified.

Interest and principal are payable monthly, beginning July 20, 2007. Additional structural protection is provided to senior noteholders through a shifting payment priority mechanism. In each distribution period, a test will be performed to calculate note collateralization amounts. If notes are undercollateralized, payments of interest to subordinate classes may be suspended and made available as principal to higher rated classes.

Through March 31, 2007, WDS's managed retail portfolio of approximately $15.4 billion had total delinquencies of 1.86%, and net chargeoffs of 1.74% (annualized) (as a percentage of the dollar amount of contracts outstanding).

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.