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Securities Based Lending

  1. Borrowing Against Marketable Securities Brian Link 818-783-7462
  2. About InSource  Founded 2001  Focus on Business Financing  Specialty in Franchise, Equipment Financing, Start-Up, Expansion, Working Capital
  3. Securities Based Financing: A New Lending Option  What it is, and isn’t  The Lending Process
  4. What It Is, and Isn’t!  Securities-Based Financing  Not credit or income based  Funds available in as few as 7 to 10 business days  70 to 90% of Portfolio Value  Rates as low as 1.6%
  5. What It Is, and Isn’t  Don’t Confuse with Similar Options  Margin Loans  Non-Recourse Stock Loans  Transfer of Title Stock Loans  How are we different?
  6. Why not a Margin Loan?  Advance Rates  They are limited to 50%  We do 70% to 90%  Calls  They need to maintain that 50% ratio  We do not
  7. Why not a Non-Recourse Loan  These products have been on the market for over a decade  Title to the underlying securities is transferred to the Lender  What if the Lender goes out of business?  As of July 2010, most transfer-of-title loans are considered sales by the IRS
  8. Our Lending Process Client completes Questionnaire. Provides Statement for review Statement is reviewed. Client ID verified Term Sheet prepared and reviewed with Client
  9. Our Lending Process Client introduced to Brokerage firm New account established and transfer commenced (NO TITLE TRANSFER) Loan Paperwork prepared and reviewed Funds available typically within 48 hours
  10. The Basics Interest rates – 1.6% to 5.50% Fixed and variable rates available Minimum/maximum line amounts - Minimum line amount is approximately $55,000, with no set maximum.
  11. The Basics Loan to Value – From 70% to 90% Documentation – Limited Fast Closing – From receipt of the Client’s statement to cash in hand can take place in as few as 7-10 days
  12. What Qualifies What Doesn’t Qualify What Does  Private company stocks  U.S. and selected non-U.S. stocks  Restricted stocks  Mutual Funds  Stocks with little or no trading volume  U.S. Treasury notes/bills/strips  Real Estate  U.S. government agency bonds  Medium-term notes (MTNs)  Municipal and corporate bonds  Standby Letters of Credit (SBLCs)  Selected bank CDs  Some foreign securities  Fannie Mae, Ginnie Mae CMO  401K - Managed pension plans  Exchange-Traded Funds (ETFs)  Publically traded REITs  Unit Investment Trusts  Selected bank CDs
  13. Most Common Uses  New Business Financing  Down Payments for Other Financing  Purchase of Existing Business or Real Estate  Bridge Loans  REO/Fix and Flip
  14. For More Information, Call Brian Link InSource Capital Services 818-783-7462