The document discusses securities-based financing solutions for real estate professionals. It outlines the challenges currently facing real estate investors in obtaining traditional financing. It then presents securities-based lines of credit as an alternative solution, where investors can use their investment portfolios as collateral for cash to invest in real estate. The basics of these lines of credit are described, including interest rates, terms, minimums/maximums and documentation requirements. Common uses of the funds are also summarized such as increasing down payments, outright property purchases, and covering rehab costs.
Why invent ? The top reason to invest is to see a return (profit) on the investment. Financial Security: Many people decide to learn more about investing because they want to feel secure financially. Lifestyle: Earning money through investing can help people afford a desired lifestyle so they can afford those things they ‘want’. Investing can also be a way for people to get their money working for them (instead of having to work for every dollar) to free up time to live the lifestyle they desire.
Secured Loan Vs. Unsecured Loan - Which One Is Better For You?Hero FinCorp
Secured loans are secured by an asset pledged as collateral. Unsecured loans are the ones which don't require any collateral. Both have their merits and demerits. Here we take you through their various facets to help you choose the one more suitable for your needs.
Why invent ? The top reason to invest is to see a return (profit) on the investment. Financial Security: Many people decide to learn more about investing because they want to feel secure financially. Lifestyle: Earning money through investing can help people afford a desired lifestyle so they can afford those things they ‘want’. Investing can also be a way for people to get their money working for them (instead of having to work for every dollar) to free up time to live the lifestyle they desire.
Secured Loan Vs. Unsecured Loan - Which One Is Better For You?Hero FinCorp
Secured loans are secured by an asset pledged as collateral. Unsecured loans are the ones which don't require any collateral. Both have their merits and demerits. Here we take you through their various facets to help you choose the one more suitable for your needs.
This workshop will help you gain a basic understanding of how the homebuying and home financing process works. So you’ll know what to expect and be better able to make informed decisions.
Tampa FL as a reverse mortgage consultant. Chris Beard works exclusively with senior homeowners seeking a reverse mortgage, a home financing program that allows mature homeowners to utilize the equity in their homes to supplement retirement income.
A bond is a (written and signed promise) debt investment in which an investor loans money to an entity (typically corporate or governmental) which borrows the funds for a defined period of time at a variable or fixed interest rate (Coupon Rate).
jimmy stepanian | Real estate commercial financing ideas | Jim stepanian |Jimmy Stepanian
The best real estate pros know a top deal when they see one. What is their secret? First, they have an exit plan the best deals are the ones where you realize you can walk away from.
Another seminar based on the book "Figuring Out Wall Street. Bond Basics provides a quick overview of how corporate bonds are used for financing the needs of business.
This presentation provides readers with an introduction to bonds and their many characteristics. Topics discussed such as types of bonds, bond trading, valuing bonds and much more are highlighted in this presentation and can be further discussed on our site www.finpipe.com.
This workshop will help you gain a basic understanding of how the homebuying and home financing process works. So you’ll know what to expect and be better able to make informed decisions.
Tampa FL as a reverse mortgage consultant. Chris Beard works exclusively with senior homeowners seeking a reverse mortgage, a home financing program that allows mature homeowners to utilize the equity in their homes to supplement retirement income.
A bond is a (written and signed promise) debt investment in which an investor loans money to an entity (typically corporate or governmental) which borrows the funds for a defined period of time at a variable or fixed interest rate (Coupon Rate).
jimmy stepanian | Real estate commercial financing ideas | Jim stepanian |Jimmy Stepanian
The best real estate pros know a top deal when they see one. What is their secret? First, they have an exit plan the best deals are the ones where you realize you can walk away from.
Another seminar based on the book "Figuring Out Wall Street. Bond Basics provides a quick overview of how corporate bonds are used for financing the needs of business.
This presentation provides readers with an introduction to bonds and their many characteristics. Topics discussed such as types of bonds, bond trading, valuing bonds and much more are highlighted in this presentation and can be further discussed on our site www.finpipe.com.
Transitional Property Investments (TPI) is a limited liability corporation (LLC) with decades of combined business and construction experience as well as investment property ownership and management. TPI seeks to provide high value, high quality, cost effective living and working environments across the communities in which we live and work while assuring profitability and sustainability for our lenders. TPI utilizes funds from our private lender network to locate, purchase and improve residential and commercial properties. Unlike traditional “flippers”, we prefer to hold and lease these properties to qualified businesses and/or individuals. With this strategy our lenders enjoy a higher, sustained return on investment for longer periods of time.
We pay a high simple interest premium to have funds readily accessible.
Castle Rock is one of the Nation's leaders in distressed commercial and residential mortgage-backed notes. This presentation provides a brief look at Castle Rock and how they manage residential distressed debt for their investors.
Client presentation on the benefits of a SMSF and the process for a SMSF to use the borrowing rules to invest in property. Includes the different ways of getting property into a fund and how to finance them.
Eddie Lampert bought Kmart out of bankruptcy. W.L. Ross made a fortune many times over buying steel and other companies out of bankruptcy. Hedge funds and other distressed debt traders buy and sell millions of dollars of distressed securities and bankruptcy claims every day. A number of private equity funds focus exclusively on buying distressed businesses, fixing, and selling them. And fortunes are made when real estate crashes by those who have the dry powder to swoop in and buy when others are forced to sell. This webinar explains how to loan to, or purchase the debt of, a company in order to acquire it (a strategy commonly called “loan to own”); how to learn about opportunities involving distressed companies; and tips and best practices for participating in bankruptcy, Article 9, and other sales of distressed businesses (including the concept of serving as the “stalking horse).
Part of the webinar series: RESTRUCTURING, INSOLVENCY & TROUBLED COMPANIES 2022
See more at https://www.financialpoise.com/webinars/
ddie Lampert bought Kmart out of bankruptcy. W.L. Ross made a fortune many times over buying steel and other companies out of bankruptcy. Hedge funds and other distressed debt traders buy and sell millions of dollars of distressed securities and bankruptcy claims every day. A number of private equity funds focus exclusively on buying distressed businesses, fixing, and selling them. And fortunes are made when real estate crashes by those who have the dry powder to swoop in and buy when others are forced to sell. This webinar explains how to loan to, or purchase the debt of, a company in order to acquire it (a strategy commonly called “loan to own”); how to learn about opportunities involving distressed companies; and tips and best practices for participating in bankruptcy, Article 9, and other sales of distressed businesses (including the concept of serving as the “stalking horse).
Part of the webinar series: RESTRUCTURING, INSOLVENCY & TROUBLED COMPANIES 2021
See more at https://www.financialpoise.com/webinars/
The Bond Market, ILFS, ZEE and DHFL Crisis at TC2019Deepak Shenoy
Deepak Shenoy of Capitalmind.in presents at Traders Carnival TC2019 about the IL&FS Crisis, what's happening with ZEE, the issue at DHFL and a bond market primer.
A Securities-Backed Line of Credit for Real Estate Investors
1. 1
Securities-based Financing Solutions
for Real Estate Professionals
Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
2. The Challenge
Prior to the mortgage meltdown, funding was plentiful via
traditional Fannie Mae/Freddie Mac lenders, private
lenders, hard money, as well as personal and business
lines of credit.
As these sources have all but dried up, savvy investors
have turned to more creative methods of financing.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
3. The Facts
• LTV limits are significantly lower than ever
• Credit score requirements are much higher
• Stated income is all but a thing of the past
• FNMA and FHLMC impose limits regarding the number
of financed properties allowed
• Second mortgages and lines of credit on investment
properties no longer exist
• Traditional mortgages do not allow for financing of
rehab or other incidental expenses
• Hard money loans have become very difficult to qualify for
• Banks do not finance property listing fees, appraisals, marketing costs,
property management fees or loan payments on unoccupied properties.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
4. The Solution
One solution is a securities-based line of credit. Borrowers
who own securities now can leverage their securities into
ready cash for real estate investments.
In essence, investors can stay in the market, invest in real
estate, and enjoy the potential benefits of two appreciating
asset classes instead of one.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
5. The Basics
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Interest rates - Rates vary depending on the credit line amount. Credit
lines of $100,000 to $250,000 average about 5.25% while lines of
$1,000,000+ start from 3%. (Fixed and variable rates available)
Line of credit terms - The typical term is 3 years but can be prepaid and
closed at any time without penalty with no additional fees.*
Minimum/maximum line amounts - Depending on the type of securities,
the minimum line amount is approximately $100,000, no set maximum.
*Variable rates loans.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
6. 6
Documentation – A No-Doc line of credit? Yes, since a securities-
based line of credit is not underwritten based on credit, income or debt
ratio, we require only a current account or brokerage statement to
issue a formal quote, usually within 24 hours.
Fast Closing – The entire process from start to finish can take place in
as few as 5 days.
Up-front Costs – There are no up-front or out-of-pocket costs.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
7. What Doesn’t Qualify
• Private company stocks • Medium-term notes (MTNs)
• Restricted stocks • Standby Letters of Credit (SBLCs)
• Stocks with little or no trading volume • Securities listed on some foreign
• Real Estate exchanges
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What Does
• Fannie Mae, Ginnie Mae CMO • U.S. and selected non-U.S. stocks
• Exchange-Traded Funds (ETFs) • Mutual Funds
• Publically traded REITs • U.S. Treasury notes/bills/strips
• Stocks traded on U.S., Australia, U.K, • U.S. government agency bonds
and most European exchanges. • Municipal and corporate bonds
• Selected bank CDs
• Unit Investment Trusts
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
8. Most Common Uses
Generating or Increasing Your Down Payment
With today’s more stringent loan-to-value guidelines, many deals are lost
due to insufficient down payments. A larger down payment can mean the
difference between closing the deal or losing it.
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Outright Purchase of Real Estate
Having access to a sizable credit line allows the investor to pay cash
for a property, avoiding the normal delays associated with traditional
mortgages or hard money loans. Once approved, your line of credit is
accessible immediately when the right opportunity comes along. The
ability to pay cash for real estate increases your overall equity and
buying power while preserving your credit for future financing
opportunities.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
9. Pay Down Existing Mortgage to Refinance
As property values have plummeted and LTV limits reduced, it has
become more and more difficult to refinance existing real estate. A
securities-based line of credit gives the investor the ability to pay
down existing mortgages to stay within current LTV limits and take
advantage of today’s lower interest rates.
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Cover Hard Costs of Real Estate Investments
Successful real estate investing requires cash, and lots of it. Even
hard money loans allow for only a small percentage of acquisition
and rehab costs to be financed. That leaves property listing fees,
appraisals, marketing costs, property management fees or loan
payments on unoccupied properties to be paid for in cash. A
securities-based line of credit can be used for all these items, with
zero out-of-pocket cost.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
10. Bridge Loans
This is a short-term loan that is used until a person or company secures
permanent financing or removes an existing obligation. Bridge loans come
with relatively high interest rates and are typically backed by some form of
collateral such as real estate or inventory. A securities-based line of credit
can be a perfect alternative.
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REO/Fix and Flip
Investors interested in purchasing bank owned properties to rehab and flip
will find a securities-based line of credit especially flexible given the ability to
draw funds to cover acquisition and all related costs, creating a true “no-
out-of-pocket” investment. Once a property is rehabbed and sold they can
simply pay the line down and be ready for the next opportunity. Interest is
paid only on the outstanding line balance.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
11. Financial Analysis and Tax Considerations*
Fact: If the annual return of your portfolio (appreciation,
dividends etc.) added to the annual return of your investment
property (appreciation, income etc.) are greater than your
annual cost of capital - you have increased your overall equity.
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• Assuming a 3-5 year term for the loan, the average annual cost of
capital will normally be between 5-6%.
• In most cases when you leverage your portfolio to purchase real
estate for investment, all of your carrying costs may be deductible.
This means that if you’re in a combined 35% tax bracket that the tax-
equivalent annual cost of capital was 65% of the numbers above, the
tax-equivalent cost of capital would be between 3.25 and 4%.
• As long as the yield of your real estate investment PLUS the yield of
your portfolio outperforms 3.25-4% per year, you will have increased
your overall equity without writing a check.
* Please consult with a licensed tax advisor prior to any decision involving your credit line and taxes.
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
12. Simplicity - Flexibility - Security
You’ve worked hard to build a strong portfolio and want the
safety of knowing your nest egg will be there when you
need it. Our securities-based line of credit offers:
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• Top-tier, fully regulated and licensed management
• SIPC-insured institutional accounts
• No title transfer required
• Prepay anytime
• All dividends paid to borrower
• All upside appreciation goes to borrower
• Limited-recourse option
• Not secured by real estate
• No obligation, no-cost quotes
• Free consultation with professional advisor prior to loan docs
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..
13. Contact
dws@securitiesfinance.com
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Daniel Stafford
Securities Finance LLC
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Not an offer to buy or sell securities; no financial advice provided.. . Please read our full Disclosure Statement before proceeding..