
	September 30, 2020		December 31, 2019
Retail finance receivables
Retail finance receivables, net of fees(a)	$	48,695	$	42,268
Less: allowance for loan losses	(1,936)		(866)
Total retail finance receivables, net	46,759		41,402
Commercial finance receivables
Commercial finance receivables, net of fees(b)	8,461		12,149
Less: allowance for loan losses	(67)		(78)
Total commercial finance receivables, net	8,394		12,071
Total finance receivables, net	$	55,153	$	53,473
Fair value utilizing Level 2 inputs	$	8,394	$	12,071
Fair value utilizing Level 3 inputs	$	48,973	$	42,012

(a) Net of unearned income, unamortized premiums and discounts, and deferred fees and costs of $63 million and $83 million at September 30, 2020 and December 31, 2019.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Allowance for retail loan losses beginning balance	$	2,044	$	881	$	866	$	844
Impact of adopting ASU 2016-13 (Note 1)	—		—		801		—
Provision for loan losses	31		149		819		492
Charge-offs	(280)		(300)		(876)		(886)
Recoveries	133		133		378		410
Foreign currency translation	8		(7)		(52)		(4)
Allowance for retail loan losses ending balance	$	1,936	$	856	$	1,936	$	856

Retail Credit Quality Our retail finance receivables portfolio includes loans made to consumers and businesses to finance the purchase of vehicles for personal and commercial use. A summary of the amortized cost of the retail finance receivables by FICO score or its equivalent, determined at origination, for each vintage of the retail finance receivables portfolio at September 30, 2020 is as follows:


	Year of Origination
	2020		2019		2018		2017		2016		2015		Prior		Total		Percent
Prime - FICO Score 680 and greater	$	14,746	$	8,064	$	5,296	$	2,348	$	744	$	177	$	5	$	31,380	64.4	%
Near-prime - FICO Score 620 to 679	2,725		2,293		1,392		712		280		103		15		7,520		15.5
Sub-prime - FICO Score less than 620	2,701		2,922		1,785		1,265		707		311		104		9,795		20.1
Retail finance receivables, net of fees	$	20,172	$	13,279	$	8,473	$	4,325	$	1,731	$	591	$	124	$	48,695	100.0	%

We review the ongoing credit quality of our retail finance receivables based on customer payment activity. A retail account is considered delinquent if a substantial portion of a scheduled payment has not been received by the date the payment was contractually due. Retail finance receivables are collateralized by vehicle titles and, subject to local laws, we generally have the right to repossess the vehicle in the event the customer defaults on the payment terms of the contract. The following table is a consolidated summary of the delinquency status of the outstanding amortized cost of retail finance receivables for each vintage of the portfolio at September 30, 2020:


	Year of Origination
	2020		2019		2018		2017		2016		2015		Prior		Total		Percent
Current	$	19,962	$	12,848	$	8,143	$	4,083	$	1,580	$	513	$	93	$	47,222	97.0	%

31 - 60 days	147		294		227		167		102		53		19		1,009		2.1
Greater than 60 days	57		122		92		69		45		23		11		419		0.8
Finance receivables more than 30 days delinquent	204		416		319		236		147		76		30		1,428		2.9
In repossession	6		15		11		6		4		2		1		45		0.1
Finance receivables more than 30 days delinquent or in repossession	210		431		330		242		151		78		31		1,473		3.0
Retail finance receivables, net of fees	$	20,172	$	13,279	$	8,473	$	4,325	$	1,731	$	591	$	124	$	48,695	100.0	%

The accrual of finance charge income had been suspended on retail finance receivables with contractual amounts due of $742 million and $875 million at September 30, 2020 and December 31, 2019.

TDRs The outstanding amortized cost of retail finance receivables that are considered TDRs was $2.3 billion at September 30, 2020, including $317 million in nonaccrual loans. Additional TDR activity is presented below:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2020		2019		2018		2020		2019		2018
Number of loans classified as TDRs during the period	13,785		19,074		17,924		43,431		53,013		51,020
Outstanding amortized cost of loans classified as TDRs during the period	$	254	$	343	$	319	$	789	$	969	$	932

The unpaid principal balances, net of recoveries, of loans charged off during the reporting period within 12 months of being modified as a TDR were $12 million, $19 million, and $20 million for the three months ended September 30, 2020, 2019 and 2018 and $27 million, $33 million, and $32 million for the nine months ended September 30, 2020, 2019 and 2018.

Commercial Credit Quality Our commercial finance receivables consist of dealer financings, primarily for dealer inventory purchases. Proprietary models are used to assign a risk rating to each dealer. We perform periodic credit reviews of each dealership and adjust the dealership's risk rating, if necessary.


Dealer Risk Rating						Description
I						Performing accounts with strong to acceptable financial metrics with at least satisfactory capacity to meet financial commitments.
II						Performing accounts experiencing potential weakness in financial metrics and repayment prospects resulting in increased monitoring.
III						Non-Performing accounts with inadequate paying capacity for current obligations and that have the distinct possibility of creating a loss if deficiencies are not corrected.
IV						Non-Performing accounts with inadequate paying capacity for current obligations and inherent weaknesses that make collection or liquidation in full highly questionable or improbable.

Dealers with III and IV risk ratings are subject to additional monitoring and restrictions on funding, including suspension of lines of credit and liquidation of assets. The following table summarizes the credit risk profile by dealer risk rating of commercial finance receivables at September 30, 2020:


	Year of Origination(a)
Dealer Risk Rating	Revolving		2020		2019		2018		2017		2016		2015		Prior		Total		Percent
I	$	6,723	$	400	$	198	$	92	$	113	$	93	$	44	$	—	$	7,663	90.6	%
II	428		1		7		12		15		13		13		22		511		6.0
III	227		—		9		29		2		11		1		—		279		3.3
IV	4		—		—		—		—		—		4		—		8		0.1
Balance at end of period	$	7,382	$	401	$	214	$	133	$	130	$	117	$	62	$	22	$	8,461	100.0	%

At September 30, 2020, substantially all of our commercial finance receivables were current with respect to payment status and activity in the allowance for commercial loan losses was insignificant for the three and nine months ended September 30, 2020 and 2019. Commercial finance receivables classified as TDRs and amounts on non-accrual status were insignificant at September 30, 2020.