How Stock Loans Work: A Step-by-Step Guide

One of the biggest advantages of stock loans is their simplicity. Unlike traditional loans that require extensive documentation, credit checks, and weeks of waiting, stock loans can close in as few as 7-10 business days.

Step 1: Initial Inquiry (Day 0)

You start by providing basic information about your securities:

• Stock ticker symbol(s)
• Number of shares
• Approximate portfolio value
• Your contact information

There's no cost, no credit check, and no commitment. Submit via our website, email, or phone call.

Time Required: 5-10 minutes

Step 2: Portfolio Assessment (Day 1-2)

Our team evaluates your securities based on several factors:

• Exchange listing (NYSE, NASDAQ, international exchanges, etc.)
• Market capitalization
• Trading volume and liquidity
• Volatility
• Any restrictions (Rule 144, lock-up, etc.)

We determine whether your securities qualify and what loan-to-value (LTV) we can offer.

Time Required: less than 24 hours

Step 3: Term Sheet (Day 2-3)

You receive a formal term sheet outlining our offer:

• Loan amount (range)
• Interest rate (fixed for the term)
• Loan-to-value percentage
• Loan term — typically 18–36 months
• Maturity options — repay or walk away (non-recourse)

Review the offer. There's no obligation to proceed. You can ask questions, request modifications, or decline entirely.

Step 4: Documentation (Day 3-4)

If you accept the term sheet, we prepare the loan documents:

1. Loan application — An information request sheet that allows us to populate the loan agreement with required items such as your full name, address, and bank details for receiving the loan amount.
2. Account statement — Either a broker or transfer agent statement demonstrating you own the shares to be transferred.
3. Identification — A driver license or passport we can use to verify your personal information.
4. Loan agreement — The primary legal document governing the loan, collateral, interest terms, repayment schedule, and events of default.
5. Documentation of share acquisition — This allows us to understand how you acquired the shares whether through a consulting agreement, stock purchase agreement, convertible note, reverse merger, etc.
6. Transfer instructions — Details for the share transfer to SLS Group as security for your loan.

Documents are sent electronically for e-signature.

Time Required: 30-60 minutes to review and sign

Step 5: Share Transfer (Day 4-5)

Once documents are signed, shares are transferred from your brokerage to our custodian:

• Brokerage account: Shares are transferred via DTC or DWAC back to the transfer agent.
• Transfer agent: Transfer agent processes the book entry transfer to SLS Group.
• Physical certificates: If shares are certificated (common with older restricted stock), the certificate is sent to the transfer agent to be entered into book entry form so the shares can be transferred.

Step 6: Funding (Day 5-6)

Once we confirm receipt of shares, funds are wired to your account:

• Same-day or next-day wire
• You'll receive confirmation of the wire
• Loan officially begins on funding date

During the Loan

Make regular interest payments (monthly or quarterly) as specified in your loan agreement.

Prepayment is generally permitted at specific anniversaries of your loan. If you want to repay early and reclaim your shares, contact us to arrange early repayment. Review your loan agreement for any prepayment notice requirements.

At Loan Maturity

At the end of the loan term, you have two options:

1. Repay in Full – Pay the principal plus any remaining interest; shares are returned to you at current value.
2. Walk Away – Because this is non-recourse, you can choose not to repay; the lender keeps the shares and you have no further obligation.

Timeline Summary

Step	Timing	Your Action
Initial Inquiry	Day 0	Submit securities info
Portfolio Assessment	Day 1-2	None – we evaluate
Term Sheet	Day 2-3	Review offer
Documentation	Day 3-4	Sign documents
Share Transfer	Day 4-5	Initiate transfer
Funding	Day 5-6	Receive funds

Total: 7-10 business days from inquiry to funding.