For firms and high net worth individuals that are seeking non-purpose capital, stock loans are a good option. In today’s banking climate, borrowing from the best financial institutions has become a hassle-filled and unpleasant experience. Potential borrowers are sure to see lower loan to value ratios coupled with much more stringent credit requirements. Those seeking high ratios and have less than stellar credit are beginning to turn elsewhere for their non-purpose capital needs. Equity, or stock, loans are one way to raise capital without jumping through the hoops of a typical bank’s multi-layered lending process. Equities First is a long-term player in this market space and has helped many clients to raise capital via this alternative vehicle.
Founded in 2002, Equities First has generated over 650 transactions and lent over $1.4 billion to its many clients that are both enterprise businesses and high net worth individuals. The flexibility of this instrument is one of the many reasons that Equities First recommends this option to its clients. The equity loan is made at a fixed interest rate over the loan term, usually set between three and four percent. The underlying collateral of stocks provides security for a non-recourse loan and there are no instances of margin calls as there are in the case of margin loans.
Equities First is here to help guide you through the process and review the ways that a shareholder loan can help to meet your capital raising needs. This vehicle is a good fit when the time in which the funds are needed is tight, as well as in circumstances where the credit profile of the borrower is not terribly strong. Stock loans also provide a bit of a hedge to the underlying assets in the event that their value decreases over the life of the loan. Learn More.