Usually, when borrowers obtain funding from financial institutions such as banks, they are often required to provide a collateral. Mostly, borrowers pledge homes or vehicles as common assets to get funding. Today, however, you can borrow against your stock. With StockLoan Solutions, therefore, you can easily assess funding by providing your stocks as collateral. Usually, the loan amount you get will be based on share price, number of shares and shares volatility among other factors.
Normally, the borrower pledge stock as collateral to receive funding. For non recourse stock loans, the borrower only loses the pledged stock if he cannot repay the loan. When you want to get some capital, however, StockLoan Solutions can provide the money you need for to finance your project.
At the end of non recourse stock loans, the borrower will have several options. First, the borrower may extend the loan. This will, however, happen if the lender allows the borrower to extend the loan for another fixed period of time. When the lender is not willing, the borrower gets his stock back. However, the borrower has to repay the loan in full to get the stock back.
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. When such a situation occurs the borrower has the option of cashing in the profit.
For non recourse stock loans, the borrower can decide to walk away in case the stock value goes down. Usually, you will get a loss on the pledged stock when the value falls below the due loan amount. When such a situation arises, a borrower may walk away for the lender to take the stock. Once the borrower walks away, the lender will not have another means of recovering the money.
Why take a stock loan.
When you use stock to get financing from StockLoan Solutions, you could enjoy some benefits. One of the benefits is flexibility that comes with taking a stock loan. Because you can use the stock loan proceeds in different ways, they offer flexibility. There is no restriction on the way you use the proceeds of stock loan like in the case of a mortgage. Stock loans are also fast. Basically you get a stock loan in a matter of days. You will only need to agree to the terms of the loan and transfer the stock to get the funding.
Basically, non recourse stock loans provide a good loan option when you need some funding.