Access cash without selling assets
As a savvy investor, you know that managing both sides of your balance sheet is an important aspect of your financial success. Planning for borrowing needs in the context of your larger financial picture and using credit responsibly may help you increase your financial flexibility while keeping your financial goals intact. And that’s where a Preferred Credit Line may come in handy. The Preferred Credit Line is a line of credit backed by the value of eligible securities in your accounts. This liquidity tool is designed to help you meet personal or business cash-flow needs. It offers an alternative to premature liquidation of assets, deferring potential capital gains taxes.
Enjoy the benefits
- A Preferred Credit Line can be used for practically any purpose other than purchasing or trading securities or paying off a margin account.
- Credit and background checks are not required to establish a Prefered Credit Line since the line is supported by your eligible assets.
- You’ll enjoy a streamlined account-opening process.
- A Preferred Credit Line allows you to pledge assets for your personal and business borrowing needs.
- The line’s competitive interest rates are generally lower than credit cards or other forms of borrowing.
Use your Priority Credit Line to …
- Fund home improvements
- Consolidate higher-interest debt
- Finance a business
- Establish an emergency fund
- Pay a tax bill
- Or whatever need is a priority for you
USouthPoint Preferred Credit Line Relationship Based Pricing
|
Household AMU |
Up to $249,999 |
$250,000 – $499,999 |
$500,000 – $999,999 |
$1 million – $2,499,999 |
$2.5 million – $4,999,999 |
$5 million and up |
|
Interest Rate |
Rate 7.25% |
Rate 5.75% |
Rate 5.25% |
Rate 4.75% |
Rate 4.25% |
Rate 3.75% |
The maximum amount of credit that may be extended for a SouthPoint Preferred Credit Line will be based on the eligible securities the Borrower maintains in a SouthPoint Preferred Credit Line Account or other accounts linked to the SouthPoint Preferred Credit Line Account. Each security assigned a “Loanable Value” as outlined in the table below. Aggregate Loanable Value will be calculated daily based on the market value of each security.
|
Security |
Advance Rate (Maximum loan as a % of market value) |
Minimum Maintenance Requirement (As a % of market value) |
|
U.S. Government Bonds |
90% |
10% |
|
GNMA, FNMA, FHLMCs |
90% |
10% |
|
Investment Grade Corporate Bonds |
70% |
Greater of 20% market value or 7% face |
|
Investment Grade Muni Bonds |
70% |
Greater of 20% market value or 7% face |
|
Convertible Corporate Bonds |
60% |
30% |
|
Exchange Traded Products, Mutual Funds, Unleveraged ETPs, UITs, Traded REITs, MLPs above $6 2/3 Exchange Traded Equities, Mutual Funds, Unleveraged ETFs, UITs, Traded REITs, MLPs below $6 2/3 ($2 per share minimum) |
60%
Maximum of 60%, declining to 0% if the per share price is $2 or below |
30%
$2 per share |
|
Free Credit, Bank Deposit Sweep, Money Market Sweep Vehicles |
70% |
30% |
|
Eligible Off-Shore Mutual Funds |
60% |
30% |
|
Eligible CDs |
75% |
20% |
Above Loanable Values and collateral requirements are based on Credit Line account equity requirements currently in effect and are subject to change at any time without notice.
Mutual Funds, Unit Investment Trusts and new issues must be fully paid for and owned for 30 days or longer before they can be used as collateral.
Loanable amounts maybe lower and minimum collateral requirements may be higher for:
- Concentrated positions
- Accounts holding illiquid or volatile positions
- Securities on which SouthPoint Capital Group holds higher collateral requirements
- No loan value will be extended on linked CDs, leveraged ETFs, non-traded REITs, commodities, futures, managed futures, options, hedge funds, private equity and annuities.
CDs with amounts greater than FDIC insurance limits may be subject to reduced loan value.
Non-Margin eligible equities and below investment grade bonds may be eligible as collateral on an exception basis only. Loanable Value and minimum collateral requirements will be determined on a case by case basis.
All collateral is subject to review and approval