Upstart offloads $333M auto portfolio to Bayview

Upstart Holdings (NASDAQ:UPST), the AI-driven lending marketplace, announced on Friday, February 20, 2026, the sale of a $333 million aggregate portfolio of auto loan assets to affiliates of Bayview Asset Management.

The transaction marks a critical step in Upstart’s transition toward a "capital-light" model, offloading seasoned loans to optimize its balance sheet for newer product launches.

The deal follows a breakout 2025 for Upstart’s auto segment, which saw originations grow fivefold year-over-year.

By partnering with Bayview—a firm known for disciplined capital deployment in mortgage and consumer credit—Upstart is validating the credit quality of its AI-underwritten auto loans.

The move is part of a larger funding overhaul intended to make Upstart more resilient to interest rate volatility.

Earlier this morning, Upstart also announced a $200 million forward-flow agreement with Wafra, ensuring a consistent pipeline of capital for future car loans.

By shifting from holding loans on its own books to acting as a high-volume marketplace, Upstart aims to protect its margins while scaling toward its newly issued $1.4 billion revenue guidance for 2026.