Multiples 4X Loan
Our clients always have to bring qualified capital (QC) to the deal. This capital acts as a balance sheet enhancement for our group and provides them with multiples of that amount in the form of expanded credit. That is why this loan is a "multiples" loan. The minimum QC is $10M USD/EUR. The loan is always a multiple of the QC, and multiples range from a 1X Matching Loan to 4X, with 3X being the most common. 4X is reserved for qualifying capital of $100M or more.
This program is industry agnostic, fundsing a wide variety of projects; from Commercial Real Estate Development, Technology Startups, Hotels and Resorts, to Mining, Infrastructure Projects and more. The loan can also be used for Refinancing, New Construction, Working Capital (business expansion) and Acquisition Rollups.
The Program Overview
Clients need to bring the necessary qualifying capital (QC) to qualify for this program. Without bringing capital to the transaction it is not possible to generate the loan and the minimum QC is $10M USD/EUR.
Client capital is secured with your attorney in his IOLTA/Trust account or in an SPV or sub-account of your corporate bank account. The QC can be positioned using cash, crypto, gold. |
Highlights
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From LIBOR to SOFR
With the elimination of LIBOR in 2023, the base lending rate is now the secured overnight financing rate
High multiple loans are at SOFR +2.5% and our matching loans are offered at SOFR +1.25%.
High multiple loans are at SOFR +2.5% and our matching loans are offered at SOFR +1.25%.
How it works:
When client capital is positioned in our loan program, it acts as a balance sheet enhancement for our wealth lending platform and provides them with additional multiples of your QC in the form of expanded credit. It is this credit expansion that furnishes the loan. There is no direct tie between the borrower and the lender's credit lines. Our lending group simply accesses their own credit lines and uses the credit available to them to fund a private loan between two private entities (the lender and the borrower).
If your QC has been provided by an investor or lender who wants those funds returned to them prior to the repayment of your loan, then you can structure your loan application package in such a manner that you can repay the investor from your loan disbursements.
Loan Terms
- Borrowers must have a minimum of $10M already raised to serve as their qualifying capital
- This is a non-recourse loan with no personal or corporate guarantees required
- Standard term is 48 months, 12 month extensions are possible
- Borrower is able to capitalize interest and fees, if needed
- Interest Only Loan at SOFR+2.5%
- The loan is fully funded in 10 months
- Minimum loan term is 12 months
- There are no prepayment penalties
- No upfront fees
- No application fee and no due diligence fee
- Minimum closing costs ($30,000) paid prior to final contracts
- Origination Fee 3% of loan amount
- Success Fee will never exceed 3%
FINANCIAL SAFEKEEPING
The only requirement of the QC is that it remains in safekeeping throughout the loan term. If those funds were to become otherwise encumbered or depleted in any way, it would violate compliance requirements and cause the loan to collapse. As a result, to ensure compliance with all banking regulations as well as similar requirements from the lending group's insurance partners, there are specific safekeeping methods to guarantee that the deposits funds will remain positioned throughout the loan.
1. IOLTA / Trust Method - client capital held in Attorney's account
2. SPV Bank Account Method - client capital remains in their own bank account
3. SBLC Method – client capital remains in their bank and an SBLC/BG is issued by their bank
Utilizing this process we can only work with top tier banks in highly stable banking jurisdictions. Under this method the Depositor's (borrower/investors) capital will remain in their bank account, and that bank would issue to the Bond Group's assigned bank a “banking instrument” such as a “SBLC” (Standby Letter of Credit) or “BG” (Bank Guarantee). Keep in mind that the issuing bank will charge fees (often substantial ones) to create, issue, and eventually recall and liquidate these instruments, and those costs will be fully the responsibility of the Depositor. Both banks (issuing and receiving) will set up the transaction in as way that the SBLC/BG will be held by the receiving bank until the loan is repaid in full; at the end of the term it will be returned in full value and without encumbrance. This will likely require the Depositor to obtain extensions on the instrument used.
SBLCs/BGs are typically discounted by the receiving bank (as the funds are not in their institution). In most cases the value of this instrument will be discounted to 80% of the face value, and the amount of the loan multiples based on the discounted amount. The discounted amount will also be bonded via the same banks/securities companies, so the discounted amount will also receive the monthly payout of their 5% annual interest on the discounted amount.
Note: Using a bank instrument for this process is only meant for clients that have a high level of sophistication in banking, and who deal directly with bankers who have extensive experience in setting up such instruments.
SBLCs/BGs are typically discounted by the receiving bank (as the funds are not in their institution). In most cases the value of this instrument will be discounted to 80% of the face value, and the amount of the loan multiples based on the discounted amount. The discounted amount will also be bonded via the same banks/securities companies, so the discounted amount will also receive the monthly payout of their 5% annual interest on the discounted amount.
Note: Using a bank instrument for this process is only meant for clients that have a high level of sophistication in banking, and who deal directly with bankers who have extensive experience in setting up such instruments.
How to Engage
You need to provide an Intake Package to engage our programs. We need your Know Your Client (KYC) and a valid and current Proof Of Funds (POF) for your qualifying capital, a 2 page Project Summary, and your desired draw schedule.
Upon acceptance of your submission we will provide a detailed Loan Proposal for your project. At that point, with the pre-approval if you want to formally apply for the loan we will provide you with our Finder’s and Financial Agreement for signature and with the agreement executed, work with you to complete and submit your full application package.
Upon acceptance of your submission we will provide a detailed Loan Proposal for your project. At that point, with the pre-approval if you want to formally apply for the loan we will provide you with our Finder’s and Financial Agreement for signature and with the agreement executed, work with you to complete and submit your full application package.
Get in touch if this structure aligns with your project's funding needs.