Our LeverageLine stock loan and credit line program is a full-featured financing tool that uses your securities portfolio as collateral. Engineered originally by A. B. Nicholas for the franchise and business acquisition client, the program has has today evolved into a perfect tool for real estate investors and those who seek funds without having to sell their securities at the outset to obtain them. We have the best rates and terms available through our direct partnerships with several fully licensed, FINRA-SIPC public brokerage and banking institutions.
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We believe we offer a number of advantages over standard margin loans or standard retail securities portfolio credit lines (stock-based loans, or SBLOCs). Our LeverageLine stock loan gives you much more, including many features of interest to commercial real estate and franchise buyers/licensees:
Our program does not require you to transfer title or ownership to your lender before you are provided with your funding, although you do need your account and securities to be housed at your lending institution. Easy as 1, 2, 3 however: processing is 100% handled for you, with your knowledge and permission, and the population of your new account at your lender’s brokerage is handled institution-to-institution, electronically, with your permission. No need to go physically down to your brokerage. All paperwork for transfer is done by your licensed lending institution for you.
Your lender advisor, with your permission as noted, handles the transfer of the securities you designate into your new account at your lending institution, seamlessly, institution-to-institution. Upon arrival and at the outset you simply have a new, state-of-the-art fully licensed brokerage account, with standard online access. Note that we by law cannot disclose the name of your lender in a public forum, but that it is fully disclosed to you on your non-obligation term sheet along with your licensed advisor’s name and FINRA registration CRD number, so that you may do a complete background check online at www.finra.gov before speaking to your advisor directly, so you know exactly who will be managing your credit line ahead of time.
Since upon arrival of your shares to their new home in your new account at your lending institution your account is just like any other; if you were to decline to proceed at that point, you’d simply have a standard modern, full-featured U. S. brokerage account like you have now, with a different major institution’s name at the top of your statements. But since you came looking for great LeverageLine financing, you’ll have the pre-approved line of credit that was stated on your term sheet ready to go with your signature on the loan docs.
If you do choose to proceed with your LeverageLine (and 99%of our clients do!) then the last step is simply to sign the credit line agreement at your lender. Once signed, the lending institution creates your checking account via their banking division, and your line is ready for wire transfer or drawdown via your checkbook on the spot.
Until you choose to draw from your stock loan line of credit, you owe nothing to your lender; in fact, many of our clients simply like to keep this low-cost, dependable line in their “back pocket” in case of future need and pay zero until they do use it. And why not? Since there are no lender mandatory costs until you draw (and then it is interest-only-required) and even those interest-only monthly payments can be deferred, your stock portfolio can keep working for you as always but with the added benefit of the best securities-based line of credit in the business ready to use on the spot.
The key distinction between the “non-recourse” stock loans of past years and our LeverageLine program is that there is absolutely no sale of your securities as a condition to funding, nor transfer of ownership or title. Thus, if you were weighing whether to sell stocks that you purchased at a much lower price originally (low basis) and are facing significant capital gains taxes if you were to sell them as is common in today’s stock market, with a LeverageLine stock loan you can access (up to 95% in some cases) your portfolio’s value without having to sell a single share.
LeverageLine clients come looking for great financing first — not professional portfolio investment management or other services, though if you want those services our lending partners will provide them to you at a discount. We built this facility with the idea that if all you want is a line of credit and nothing else, you can have it. We are the only firm in the market, we believe, with the high-level, institutional lenders willing to serve you without having a pre-existing account with them.
So any service beyond your simple loan are always optional when you have a LeverageLine. We’re proud of the hundreds of satisfied clients we’ve served over the years, helping us to earn the coveted A+ rating by the Better Business Bureau.