Lombard Loan

A Lombard loan uses investment portfolios of stocks, bonds, or funds as collateral for property financing, offering higher LTV ratios on liquid assets and preserving investment positions while accessing capital.

Collateral StructureDetails
Eligible assetsPublicly traded stocks, bonds, funds
LTV on securities50-70% depending on asset class
Portfolio value requirementTypically 150-200% of loan amount
Margin callsPossible if portfolio value drops
Comparison to TraditionalAdvantage
Property LTV65-75% traditional
Combined LTVUp to 90% with Lombard structure
Down paymentMinimal cash required
Investment preservationPortfolio remains intact and growing
Cost and Risk AnalysisConsideration
Interest rate1-2% above standard mortgages
Portfolio performanceMarket volatility risk
Forced liquidationMargin call scenarios
Total leverageHigher overall debt exposure


Related Terms

CollateralCross-CollateralizationProfit MarginSecurities-Based Lending Investment Property

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