Small Business Success: Portfolio Loans [Video]

If you have at least $85,000 in stocks, bonds, mutual funds or other eligible securities, you can borrow up to 80 percent against the value of your portfolio to fund your new business. Portfolio loans have many benefits — they’re a fast, low-cost approach to alternative business financing.

Learn more about portfolio loans in our most recent Small Business Success video — Guidant CEO, David Nilssen discusses the requirements and advantages of leveraging your investment portfolio to fund your small business.

No time for a quick video? Here’s the transcript:

David Nilssen: When most people think about small business financing, the SBA or Rollovers for Business Start-ups might be the first thing to come to mind. But we’re seeing more and more people leverage their non-retirement assets to buy a small business. If you have over $85,000 in a nonretirement based securities account, you can leverage up to 80 percent of your stocks or bonds or mutual funds without selling them.

So, there are three potential advantages to going down this path. The first is what I alluded to, and that’s an opportunity loss. Most people would liquidate their securities in order to buy a business. In this case, you don’t have to and thus as they continue to grow in value, you would still capture that value.

Another would be the low interest rates. We’ve seen rates granted under five percent for these types of loans. And the final [advantage] is speed. Most traditional loans take up to two to three months to secure. In this case, they can be secured in about 10 days. It’s important to note that there are no payments unless you use the capital. So, you’re not penalized for coming in under budget or even overestimating the cost of a project.

You can combine these funds with the Rollover for Business Start-up, giving you increased purchasing power and more flexibilities as an entrepreneur. Guidant Financial works with our clients to help them determine the right economical solution for them to finance their business, and you can leverage our network to find the best-suited financing solution for you.

Table of Contents

Download the Guide

Download the Complete Guide to 401(k) Business Financing – you can save it for later or print it at your leisure.

Download the Guide

Download the Complete Guide to 401(k) Business Financing – you can save it for later or print it at your leisure.

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