Lombard Lending: Unlock Liquidity Without Selling Assets

Lombard Lending: Unlock Liquidity Without Selling Assets

Lombard lending offers a flexible and efficient financing solution for individuals looking to leverage their investment portfolios. At Million Plus Private Finance, we specialise in arranging bespoke Lombard credit agreements that provide immediate access to liquidity while allowing clients to retain ownership of their valuable assets.

What Is Lombard Lending?

Lombard lending enables borrowers to pledge easily liquidated assets, such as stocks, bonds, or life insurance policies with a surrender value, as collateral for a loan. The loan amount is determined as a percentage of the market value of the pledged assets, with lending value percentages depending on the type and risk level of the securities.

This financing solution is ideal for those seeking to maintain their investment positions while unlocking liquidity for other opportunities, such as purchasing property, funding business ventures, or covering significant expenses.

Key Benefits of Lombard Lending

  1. Access to Liquidity: Borrow against your investment portfolio without selling your assets.
  2. Retain Investment Growth: Continue to benefit from the potential appreciation and earning capacity of your portfolio.
  3. Flexible Financing: Use the funds for any purpose, from investments to property purchases.
  4. Lower Interest Rates: Collateralised loans often come with lower interest rates compared to unsecured borrowing options, as the risk to lenders is reduced.

How Lombard Loans Work

  • Asset Pledge: Borrowers pledge eligible assets, such as equities or bonds, as collateral.
  • Loan-to-Value (LTV) Ratio: The maximum loan amount depends on the LTV ratio, which reflects the asset’s value and volatility. For instance, less volatile assets may result in a higher LTV.
  • Phased Drawdowns: Funds can often be drawn as needed, providing further flexibility.

Considerations for Lombard Lending

While Lombard loans provide significant advantages, it’s essential to consider potential risks:

  1. Market Volatility: If the value of the pledged assets drops significantly, the lender may require additional collateral or sell part of the portfolio to cover the loan.
  2. Repayment Obligations: Failure to meet repayment terms could lead to the liquidation of assets.
  3. Eligibility Requirements: Most lenders require a minimum loan amount and ensure the collateral’s value exceeds the loan amount to account for price fluctuations.

Who Is Eligible for Lombard Lending?

Lombard lending is typically available to individuals with:

  • Substantial Investment Portfolios: Assets such as stocks, bonds, or other easily liquidated securities.
  • Stable Financial History: A solid financial track record increases eligibility and allows for favourable terms.
  • International Earnings: Some lenders cater to clients earning in foreign currencies or living overseas.

How Million Plus Private Finance Can Help

At Million Plus Private Finance, we provide expert guidance to secure Lombard lending agreements that align with your financial goals. Here’s how we support you:

  • Bespoke Solutions: We tailor each agreement to match your unique needs, ensuring flexibility and favourable terms.
  • Extensive Network: Our relationships with leading lenders enable us to access competitive rates and customised financing solutions.
  • Expert Advice: We assess your financial position and provide strategic advice to help you navigate the complexities of Lombard loans.
  • International Expertise: We cater to global clients, ensuring access to suitable financing regardless of location or currency.

Why Choose Lombard Lending?

Lombard lending offers a unique opportunity to unlock liquidity while preserving your investment portfolio’s growth potential. It’s an excellent choice for high-net-worth individuals seeking a cost-effective and flexible way to finance new ventures or significant purchases without disrupting their financial strategies.

Start Your Lombard Lending Journey Today

Lombard loans can be a powerful financial tool, but they require careful consideration and expert advice. At Million Plus Private Finance, we’re committed to helping you secure the best terms and navigate the risks effectively.

Contact us today to learn how Lombard lending can support your financial aspirations while keeping your investments intact.

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Your home or property may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
 
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