In the recent past, the economic climate all over the word has been rough. There are certain factors that indicate that most of the economies are going through recovery, however, the success hasn’t translated to much for most of the borrowers. It is still very difficult for many people to get bank loans and when they do, the interest rates are simply so tough that borrowers get discouraged and stay away. Equities First Holdings is one of the companies that have realized the problem in the market and are taking steps to make sure that things have improved. The company has been allowing customers to use their stocks as collateral for their loans.
The truth about stocks is that they tend to have a loan to value ratio that is higher than that of the conventional loan. This however does not make them any less important than the bank loan. In case for one financial constraint or the other you cannot access your regular bank loans. This is the best alternative. There are lots of fluctuations that occur during the normal three year term of the regular bank loan. When you use stock as collateral, you do not have to suffer as a result, in reality, you will have a simpler time because the market is already working in your favor by being on the downside.
Another hindrance to the spread of these loans as a viable alternative is the fact that not many people understand the difference between the regular stock loan and the margin loan. Margin loans are a little harder to access because of the pre-qualification requirements. Other things needed to access the loans include stating the purpose of the loan among others. The stock loan is great because their interest rates are fixed at between 3 and 4 percent. In case you have any of the stocks trade in the major markets around the world, Equities First Holdings can offer you a loan and use the stock as collateral.