Why LeverageLine?

Why Choose a LeverageLine over a Margin Loan or Retail Stock Loan | Credit Line

Lowest Wholesale Interest Rates in the Market

We at A. B. Nicholas started many years ago with the premise that our clients needed something better than what the retail securities-based credit line market offered, so we studied the competition first. What we found was that without exception, the market offered even pre-existing clients higher rates, lower loan-to-value, and no specific expertise in the fields that mattered most to our clients — commercial real estate investing, business acquisition, and franchise purchasing. In fact, we found a market where the securities-based credit line was often handled in a profit-and-fees driven manner, not with the client’s financial objectives primarily in mind.

We sought better. 

LeverageLine is faster, less expensive and usually requires much less documentation, except for very complex cases (which we can handle too). It offers top-notch security, expert institutional advisers with experience in our specific target market fields, and high-quality, professional support for our clients as they grow their businesses or real estate investments in the future — again, normally at no charge.

Most of all, when you obtain a LeverageLine you will be receiving lending services, not mandatory investment services. You certainly can opt for full-scale investment management with our carefully selected advisers at our institutional lending partners — and they are very good at what they do, plus you’ll get their services at an A. B. Nicholas discount over market — but that is up to you. There are no mandatory “account management fees” or “service fees” or other hidden lender-side fees for services you may not want or need as a borrower. In summary, with our LeverageLine securities-based credit line program you will not get the “hard sell” to pay for financial advice, investment assistance, new brokerage or banking programs, or any other add-on service.  What you will get is the lowest-rate, highest LTV securities-based credit line the market offers.

Perhaps you are thinking that our LeverageLine program is just a “glorified margin loan”. It is not.

For example, a margin loan will almost always have rates as much up to twice as much as a LeverageLine. Your stock margin loan is standard with 50% cap on loan-to-value. It always comes with a very tight reserve maintenance policy as well. Standard margin loans operate on single securities, not for a portfolio or basket of securities where overall value averaged together as with LeverageLine.

With a margin loan, a fall in that single stock can quickly put your collateral into an insufficient status; if so, that would require you to shore up the value or sell shares shares immediately.

With our LeverageLine, you must maintain value too of course, but the value of your collateral is an average of all the stocks, bonds and/or mutual funds in your securities portfolio, so if there is a drop in value of one stock, it will not necessarily affect the overall collateral value significantly. For example, all things being equal, a drop in one stock could be offset by a rise in another in the portfolio. The licensed lending institutions we have chosen to work with are required to adopt a client-friendly policy where they strive always, to the extent possible, to ensure that you are informed and in control at all times.

Your LeverageLine stock secured loan was informed by our client base:

– The new franchise buyer or expander

– The new business acquirer or expander

– The real estate investor (but n0t primary residence/mortgage clients)

This isn’t just any stock secured loan program. LeverageLine has been customized for its core markets . It includes features that make it ideal for the commercial real estate investors too. These include

  • Freedom to defer interest payments to preserve cash flow;
  • Wholesale interest rates to minimize your overall cost of financing.
  • Speedy delivery of funds to ensure that our clients can take advantage of opportunities quickly before they disappear.
  • Pre-approval funding letters if needed to help facilitate deals;
  • A lender policy of doing their utmost to become an active partner in each client’s success — yet with no mandatory account management or other fees and
  • Freedom to trade in your account as long as overall portfolio value is no signficantly decreased.

Mostly, you’re getting a partner in your future business or commercial real estate growth. You are beginning with a very competitive, low-cost, asset-based, stock secured loan (LeverageLine) as an entrance point into what can be a long-term financial relationship with a major public institution if you so desire.

So again… Why LeverageLine? Because it’s a powerful, custom financial tool loaded with features expressly designed for clients like you.

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1050 Connecticut Ave NW, Suite 500, Washington, DC, 20036 Tel: 202.379.4744
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Securities based lending may not be suitable for all securities owners. A. B. Nicholas urges all clients to discuss these risks with their licensed lender advisor should they proceed with their LeverageLine. Any activity involving securities, including borrowing, by definition involves certain risks and if the market value of your pledged securities declines to the point that you must add cash or assets, , for example, you may be required to pay down your line of credit, restructure your holdings into more stable securities (which can involve a sale), or both in order to maintain your loan. Although both A. B. Nicholas and each ABN lending partner advisor make maximum effort to ensure that acceptably good quality securities are accepted so as to minimize risk to the extent possible, we cannot guarantee any specific outcome of any securities performance and by proceeding you are acknowledging this. All lending, management and processing is handled solely by fully licensed U. S.-based FINRA/SIPC institutions (and their FDIC-member banking divisions) with which A. B. Nicholas has partnered for this custom program. Please review our disclaimer prior to proceeding. Our privacy policy is located here.