Cash, Banking & Lending Solutions
1. Insured Cash Account (ICA)
The LPL Insured Cash Account (ICA) is an FDIC-insured, interest bearing, automated cash sweep program. Every business day, uninvested cash is automatically transferred to the LPL ICA, so that your cash earns interest without incurring transaction charges. When the cash is needed to cover a debit, it’s automatically transferred back to the account to fund the transaction. Cash swept through LPL ICA is insured by the FDIC.
ICA Disclosure Booklet March 2021
2. Premier Cash Management
Convenient cash management services allow clients to manage their long-term investments and day-to-day finances in one convenient account. You have the flexibility to offer value-added services to meet your clients' needs, including unlimited check writing, a VISA Platinum debit card, wire transfer services, direct deposit and online bill pay.
3. Securities Backed Line of Credit
Securities Backed Line of Credit (SBLOC) allows clients to use their investment accounts as collateral for a variable or fixed rate line of credit. Proceeds from the credit facility are used for several short-term or long-term financing needs but cannot be used to purchase investment vehicles or pay off any margin loan.
4. Cash and Banking Solutions Credit Cards
LPL has partnered with UMB Bank, to offer an exclusive Visa® credit card program which allows LPL clients access to the Visa® Signature Simply Rewards Card and the Visa® Signature Direct Cash Card. This page compares both cards.
5. Margin Lending
Why use Margin?
Clients have traditionally used bank-backed vehicles to borrow funds, ranging from credit cards to personal loans. When clients consider lending vehicles, they typically don’t consider using the assets they’ve saved in brokerage accounts simply because it hasn’t been presented as an option.
This provides a unique opportunity for you to be the first to have the conversation with your clients and add another tool to your tool kit. Not only can you assist with clients’ planning, investing, and banking needs, now you have the opportunity to expand your book of business to clients who have lending needs using assets they have already accumulated. This creates a more comprehensive advisor-client relationship that may contribute to client longevity and satisfaction.
Margin can be used for many things ranging from diversification of assets to loans for home renovations and bridge loans. It is an often-overlooked source for cash needs, as it comes from assets that are already invested in financial products and does not go through the traditional process of acquiring a loan. Margin loans are a non-traditional source for such needs that can be set up at the initial account opening or during the life of an investment account, and do not have a specific repayment schedule.
Margin Key Benefits
- Flexible Repayment Options
- Compared to other loan vehicles, using a margin loan against a client’s account allows your clients to have an option to repay their loan at their own convenience, as long as they maintain minimum equity requirements within their account
- Immediate Funds Access
- Through a traditional loan, funding and withdrawal limitations may be enforced throughout the life of the loan. With a margin loan, as long as there are funds available and margin is activated, the loan can be accessed immediately
- Competitive Loan Interest Rates
- Interest rates on margin loans are often lower than interest rates on credit cards and other consumer loans. Additionally, clients can qualify for more discounts based on the value of their total household if they are grouped.
Margin Lending Consumer Brochure