New for Client Applications for LeverageLine Financing (Information for Clients & Agents)

As you know, one of the reasons that A. B. Nicholas is the leading private conduit to institutional licensed stock-secured lending is that we are always focused on compliance and on improving the lending experience for our clients. 

To that end, we have implemented a new rule for all agents when submitting clients to A. B. Nicholas for review. Together with this new rule, we have streamlined the entire lending procedure so as to provide maximum control and flexibility to the client and maximum freedom for the licensed lender advisor to meet the needs of every client submitted to A. B. Nicholas. 

New Rule

From July 10, 2019, ANY and ALL applications must not only come through our secure web form, which is designed to protect the privacy of client information, but must be filled out and signed by the client him/herself. Whereas we did permit our agents to collect documents and fill out application forms in the past for our clients, new FINRA-compliant measures require that only the client fill out these forms for legal reasons. 

New Process

In the past, A. B. Nicholas received the terms from our licensed lender partners, then built it into a term sheet, then shipped the term sheet for signing to the client with copy to agent. This system had several drawbacks: 

  1. It took up more time, as ABN had to assemble the term sheet, deliver it to the client, then wait up to a week for client to sign 
  2. It added another administrative layer, meaning more paperwork. 
  3. It limited, to some extent, the lender’s flexibility to adjust the loan offer based on client needs or expectations. 

Our closing ratio with this system was not as high as we wanted, and in some cases it caused a little confusion among the client borrowers. 

Therefore, as of July 10, 2019, the new system at A. B. Nicholas is faster, with less paperwork, and far more flexibility so that our lending partners can more precisely meet the needs of each individual client. 

From now, when we receive a new application at www.abnicholas.com/quote, we will send to one of our three lending institutions/partners to quote, sometimes all three. They will return a ballpark quote based on an examination of the collateral, and we will build that information into a “transmission email” to the client, CC to the agent, that outlines the offer. We will always included the lender-advisors FINRA information and URL so they may look up the background of the lender-advisor we have chosen for that client. 

We will notify the lender to wait a few hours, then call. If the client is not there, a voicemail will be left, and lender will follow up next day if no response by then. 

From this point, the final amount, rate, and terms will be finalized. Lender will update A. B. Nicholas, and we will update your sales portal so you are autmatically apprised of all developments. ABN, however, steps out of the way immediately to allow the licensed lending institution and advisor to close the loan, one-on-one. 

Once fund are almost ready, ABN will bill the client per the fee schedule listed on www.abnicholas.com/quote. Because the client is agreeing at the time of application to our fee schedule based on breakpoints, there is no need for client to sign any further documents. The fee we charge will be based on the rate-table they will have agreed to at the time of application. 

Upon receipt of funds, agent’s share will be immediately disbursed by wire. All fees are due from clients within one (1) business day of opening of line, and may be paid from line, credit card, or ACH wire. 

Our new system puts the onus of closing on the licensed lending advisor professionals, who will now have maximum flexibility to speedily serve the client with custom LeverageLine terms. It cuts the process time by 90%. It puts full control for each client’s credit line firmly in the client’s hands alone. 

If you should have any question about this new policy, please do not hesitate to contact us. 

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