Lenders Beginning to Use Stock As Collateral for Loans, says Equities First Holdings

In the current financial climate, banks are less and less likely to give loans easily, with high rates and requirements. For people who need capital and fast, there have been many methods in which to get a loan. Equities First lending is gaining popularity in recent years as an option for those who need capital and pronto.

According to Al Christy, Jr, Founder and CEO of Equities First Holdings, loans collateralized by stocks is a unique alternative for many in the current day. During a typical three year loan term, using stocks as collateral works, because during a down market the borrower is lowering his investment risk. On top of this, says Christy, this loan allows the borrower to walk away at any time, despite depreciation, keeping the initial loan proceeds.

Stock based loans generally have a three to four percent interest rate and 50-75% loan-to-value ratios. These kinds of loans have no restriction, so they can be used for any purpose.

Stock-based loans have been historically ignored as a viable borrowing option largely because a number of unscrupulous lenders have unceremoniously dumped borrowers’ collateral into the open market, failed to return stocks upon transaction maturity, or failed to address other concerns,” said Christy.

Equities First Holdings primarily provides clients with alternative financing solutions and has completed over 650 transactions worth almost $1.5 billion to date. They have offices in nine countries, including the UK, China and Australia. Alternative loans like those they specialize in are especially beneficial for a company or individual who seeks to look outside the box to gain capital and contact this company.

Leave a Reply

Your email address will not be published. Required fields are marked *

Recent Posts

Recent Comments




    GiottoPress by Enrique Chavez