As a matter of fact, borrowers are required to pledge collateral to obtain financing from financial institutions like banks. Mostly, borrowers pledge homes or vehicles as common assets to get funding. You can, however, use your stock as security for a loan. At StockLoan Solutions, you pledge your stock to easily get funding. Usually, the loan amount you get will be based on share price, number of shares and shares volatility among other factors.
Basically, a stock loan allows the borrower to offer stock as the collateral. When the borrower is unable to repay the loan, he will only lose the stock for non recourse stock loans. When you want to get some capital, however, StockLoan Solutions can provide the money you need for to finance your project.
When non recourse stock loans come to an end, a borrower has certain options. First, the borrower may extend the loan. Extending the loan will only happen when the lender accepts the borrower to do so for another fixed period. When the lender is not willing, the borrower gets his stock back. For the borrower to have the stock back, the loan must be fully paid.
When there is an upside increase in the stock value, the borrower may choose to cash in the profits. A profit is realized when the stock values go above the loan amount due. In such a case, the borrower may opt for a cash payment on the profit.
For non recourse stock loans, the borrower can decide to walk away in case the stock value goes down. The loss arises when the pledged stock falls below the amount due on the loan. In case of a loss and the borrower walks away, the lender takes such stock. Once the borrower walks away, the lender will not have another means of recovering the money.
The Advantages of stock loans.
The borrower enjoys several benefits by getting StockLoan Solutions loan and pledging stock as collateral. Usually, stock loans offer the benefit of being flexible. The flexibility of stock loan is seen since you can use the loan for a different purpose. You are not restricted on how you use the stock loan proceeds unlike in a mortgage. Stock loans are also fast. Basically you get a stock loan in a matter of days. At StockLoan Solutions, you only need to transfer the stock and agree to the loan terms.
When you want some funding, StockLoan Solutions is a good option for non recourse stock loans.