Starting a business is exciting, but one must have enough capital to start the business. The capital can come from personal savings, money borrowed from family and friends as well as loans from an investment institution. Lately the investment banks have been tightening their borrowing criteria and have put strict measures as well as high-interest rates to borrowers, something that has led some individuals establish institutions that offer alternative borrowing resolutions.
Equity First Holdings is one of the leading lending organizations in the United States that specializes in the provision of alternative borrowing. The institution was established in 2002 and it offers margin and stock –based loans that uses the publicly traded shares as security. Equity First Holdings is a great benefit to business people who want to raise quick capital and do not qualify for the conventional bank loan. Equity First Holdings noticed the gap that was there in the financial industry and decided to fill it.
Equity First Holdings provide margin loans, for a borrower to qualify for margin loan, they must have a pre-qualification of a conventional bank loan. The money borrowed must be used for the specified purpose, as for interest rates of the margin loans they are known to be variable and the borrower can expect the loan-to-value ratio between 10-50%. On the other hand the lender can liquidate the collateral without giving any notice to the borrower which can occur at the event of a margin call.
As for the stock-based loan, the borrower can use the money borrowed for any purpose and the interest rate is usually fixed. The loan-to –value ratio of stock-based loans range between 50-75%. The stock –based loans have an added advantage of being resourceful and this feature allows the borrower to walk away from the loan without any obligation even in the event of the decrease of stock collateral. Al Christy who is the Chief Executive Officer of Equity First Holdings mentioned that any loan has a risk attached to it but as for the stock-based loans have historically ignored.
Equity First Holdings have built a business under a strong foundation and basis of transparency, integrity, and have for many years relied on the leading lawful, supervisory, as well as trading institutions for counsel. The financial institution’s missions is to deliver maximum risk as well as maximum benefit for their clients to meet their long-term personal and professional goals