Prepayable Standard Variable Rate (30-Day LIBOR) LeverageLine
Retail vs ABN Rate
Fixed Four Year Rate
Retail vs ABN Rate
All figures based on an example portfolio of:
$800L UPS stock at 75% Loan-to-value (LTV), with an approved credit line of $600K
Call us to get support by phone: 202-379-4744
(Note: for more, read our blog post on Portfolio Loan Rates).
There are some significant feature differences between our Fixed Rate LeverageLine and our Variable Rate LeverageLine. Please note carefully.
Our standard figures are shown in the example above; but from time to time, we can offer special extra-low-rate fixed rates. Join our mailing list to be advised of new low-rate, limited-time specials.
Let’s assume for purposes of illustration that you are pledging $800K worth of quality of securities (e.g., UPS or Apple stock in this example). Your maximum loan authorization is 75% for a single stock position (75% LTV — would be approximately 77-80% at least if the portfolio contained multiple stocks to spread collateral risk around). At 75%, which comes to a $600K line of credit, our ABN LTV is already the best in the market.
The question now follows: Do you opt for a Fixed Rate LeverageLine based on one static rate for a set number of years (1-5 are offered); or do you select a standard Variable Rate LeverageLine based on 30-Day LIBOR rates, as most of our clients do since they can easily convert (at no cost) to a fixed rate line at any time?
Normally, with fixed-rate lines, there are some drawbacks. First, you have to take all of your loan allocation and pay interest on all that amount right from the start normally; but we at A. B. Nicholas have obtained agreement from your licensed lender adviser to permit a $600K loan/line of credit allocation, and our clients only are allowed to take as little as $250K and still fulfill the obligations of the fixed rate LeverageLine loan terms. (Typically, if the client’s loan authorization was only $250K, they’d pay a higher rate for the lower authorization – likely over 7.2 %). So from the start, our version of the fixed rate securities-based credit line saves our clients on interest immediately, while retaining choice.
Whether to invest in real estate, buy a vacation home, or supplement/replace your existing high-interest financing, LeverageLine can be the answer you’ve been looking for. And best of all? There’s no obligation or cost to apply!
Call to become a registered agent: 202-379-4744