Since its launch in 2002, Equities First Holdings (EFH) has been a leader in the provision of alternative financial service. It has supplied funds against public traded share to allow customers to achieve their goals. The firm prides itself on completing over 700 transactions and delivering over $1.4 billion in funding. It operates on an international scope and has offices in nine strategic countries.
EFH spots a rising trend among clients who use stock-based loans
EFH is detecting an increase in the usage of stock-based and margin laws in a challenging climate where banks and other notable lenders have introduced complex lending criteria. Investors who are in need of urgent capital and individuals who do not meet the requirements of convention credit-based loans can turn to Equities First Holding for assistance. However, such persons must be holders of publicly traded shares. They should be willing to use their shares as security for obtaining the loans.
What makes EFH’s share-based loans unique?
Equities First Holding adheres to high integrity standards and participates in sound business activities. The firm is always prepared to reimburse borrowers’ shares once the transaction matures. The policy remains intact even after the decline in the share value that may arise during the transaction. EFH sets fixed and affordable interest rates for its stock-based loans. The firm’s team of loan advisors guides the clients through the entire process of loan application.
Types of securities-based loans
- Margin loan: While this loan uses stocks for collateral, it has some similarities with credit-based loans. For instance, the borrower ought to be pre-qualified, and usage of the funds is limited to the terms and conditions. The loan-to-value proportions may be between 10 and 50 percent. In the case of a margin call, the lender has the right to liquidate the client’s collateral without notice.
- Stock-based loans: The fixed interest ranges from 3 to 4 percent and proportion of loan-to-value falls between 50 and 75 percent. The borrower has the right to use the money for any legal purpose. Most share-based loans operate under the non-recourse policy and, thus, the lender reimburses the borrower even after the collateral stock has depreciated.
Equities First Holdings is a leader in the provision of alternative loans using stocks as the collateral. In the recent past where the economic crisis has slowly hit the world, the need for an alternative financial solution is growing. Therefore, Equities First Holdings presents itself as the next best way to secure fast working capital for your business. These loans are characterized by the non-recourse feature that lets you walk away from the loan without worrying about paying back. For this reason, they allow you to enjoy your investment. As a matter of fact, banks and other lending financial institutions have tightened their loan qualification criteria.
Due to the economic crisis hitting the world they have increased the loan interest rates and cut down their lending options. For this reason, most of their applicants will walk away without meeting their needs. This calls for another better financial solution to get the way. Equities First Holdings offers itself as the reliable financial solution that uses stocks as their collateral to issue loans. While many other large financial institutions allow you to get the stock-based loans, Equities First Holdings offers the best services as a private firm. The large banks like the JPMorgan Chase bank issue stock-based loans. However, they have many restrictions as a public company.
For borrowers who do not qualify for the credit-based loans and need fast working capital, Equities First Holdings has grown enough popularity to serve your needs. While there are numerous options for borrowers out there to secure money for themselves, the banks have cut down their lending criteria. There is an increased interest rate on the credit-based loans.
On the other hand, the stock-based loan allows you to enjoy minimum low-interest rates of up to four percent. For this reason, you will benefit from the proceeds of your loans. Whenever you fail to pay the loans, you can walk away from the loan without any further obligation to the lender. The stock-based loans offer a higher loan-to-value ratio.
During a three-year loan term, there is always inevitable market fluctuation. For this reason, the borrower must protect their stock values. However, the stock-based loans are here to protect you from because your investment risk is low. For this reason, you will keep the proceeds of the loan without remaining under the lender’s obligation. According to Al Christy, there are marked differences between stock-based loans and margin loans. Moreover, stock-based loans are better.