Wholesale, Lowest-Rate Financing
Our LeverageLine program is a full-featured credit line that uses your securities portfolio as collateral. Engineered originally by A. B. Nicholas for the franchise and business acquisition client, the program has also evolved into a perfect tool for real estate investors and those who seek lending with the best rates and terms available.
We believe we offer a number of advantages over standard margin loans and standard retail securities portfolio credit lines (stock-based loans):
- Wholesale interest rates, in most cases equivalent to or better than the best 30-year mortgages
- None of the limitations of margin loans (LTV, use, rates, process)
- Interest-only payments required
- A revolving line of low-cost credit; no balloon payments or maturity dates
- Credit score not a factor in approval. (But no bankruptcies/foreclosures prior 5 yrs).
- Speedy delivery with same-day pre-approval in most cases
- A simple background lien on your assets to guarantee lender’s interest
- No loss of ownership or any form of title change; simple asset-based financing.
- No mandatory lender-side account management fees
- No interest charged until you actually draw from the line
- No sale of securities to fund your line of credit
- No hidden fees or costs
- Online access and freedom to trade in the account
- Option to defer interest payments any time
- Pay back principal when you wish
- Major U. S. institutional, well-known lender
- Experienced, multi-licensed FINRA-member lender advisors
- Securities in portfolio averaged to stabilize collaterals
- Opens a financial relationship with a major institution for future funding priority
Keep Your Collateral
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. All processing is handled for you, with your knowledge and permission.
Same As Your Current Brokerage Account
Your lender advisor, with your permission, 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, modern, licensed brokerage account, with standard online access at a major U. S. brokerage and banking giant, which we disclose to you in full on your term sheet along with your licensed advisor’s name and FINRA registration number, so that you may do a complete background check online.
Since upon arrival of your shares to 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. But since you came looking for great financing, you’ll have a line of credit offer waiting for you with the rates and LTV as stated on your Term Sheet.
A Simple Asset-Style Stock Loan
If you do choose to proceed with your LeverageLine (and most of our clients do!) then the last step is simply to sign your 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 checkbook on the spot.
Interest Only on What You Draw
Until you choose to draw from your line 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 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 benefit of a great credit line in place as “insurance.”
A True Credit Line with No Change of Ownership
The key distinction between the “nonrecourse” 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, with LeverageLine you could access the value of your portfolio – up to 95% in some cases – of your portfolio’s value without having to sell a single share.
Other Services Optional, at Lower Cost
LeverageLine clients come looking for great financing first — not professional portfolio investment management or other services. We built this facility with that understanding in mind, because our franchise and business acquisition clients only wanted financing. We accomplished this.
So any service beyond your simple loan are always optional when you have a LeverageLine through A. B. Nicholas, unlike all other lenders. But if you do desire portfolio management, your licensed lender advisor is exceptionally qualified and will be happy to assist, though you’ll get great account management services at up to half the annual costs.
Why not get a free, no-obligation term sheet today? Let us show you what you qualify for in a pre-approved financing offer. Start here.
Keywords: risk managementÂ interest rate dividend payments pay interest loans secured short sellersÂ brokerage firm securities including short sale securities lending agreement hedge fund borrow money short selling long term stock exchange traded federal reserve number of shares