LEASED INSTRUMENT MONETIZATION
QUESTION: CAN A LEASED INSTRUMENT BE MONETIZED?
ANSWER: The short answer is “yes”. The longer and more accurate answer is that you can take a leased instrument into trade ONLY IF the actual owner/titleholder of the instrument is fully participating within the transaction.
Nobody is going to monetize and/or trade an asset for somebody that doesn’t own and have full control of the asset. For example …just because you lease/rent a house or a car… you can’t borrow against or sell the house or the car because you don’t actually own it... right?
NOTE: One major mistake parties that lease instruments often make is thinking they deserve the same respect as an actual titleholder that owns the instrument. Another mistake is thinking that a reputable trader is going to issue a trade contract to the lessee to convince the titleholder to participate within a monetization and/or trading transaction.
(The actual titleholder will be the primary client when trading a leased instrument.)
The quality of a compliance package is the key issue and critical factor in achieving successful monetization at the highest LTV.
REQUIRED ITEMS FOR SUBMISSION
- Copies of instrument(s).
- Copies of any paperwork that supports the instrument’s authenticity and/or safekeeping.
- Copy of lease contract between titleholder/provider/applicant and lessee/beneficiary.
- Copy of profit sharing contract between titleholder/provider/applicant and lessee/beneficiary.
- Client Information Sheet (CIS) that includes client attorney info for the lessee/beneficiary.
- Client Information Sheet (CIS) that includes client attorney info for the titleholder/provider/applicant.
- Letter of Request (LOR)
- Letter of Non-Solicitation (Hint/Tip: Non-solicitation language could actually be intelligently worded/included within the LOI to avoid creating multiple documents.)
- Copy of banker’s business card that is blocking the instrument.
- Attestation Letter from client's attorney/advocate attesting that the attorney has verified the authenticity of the the beneficiary, the applicant, as well as the issuer. as well as the authenticity of all banking relationships between all parties.
- A list of intermediaries involved in-between.
| TIMELINE/ROADMAP | |
|---|---|
| TASK | DURATION *** |
| INFORMATION GATHERING | |
| 1) Gather Submission Data | Depends on client and asset |
| 2) Magister Operis due diligence on data | 24-72 hours |
| 3) Direct dialog with client to make sure the client is real and ready as well as client’s bank, legal representation, and/or underwriter are ready as required. | 15 minutes to 1 hour |
| 4) Intermediaries professionally package themselves for efficient payment. | 24 hours |
| 5) Magister Operis packages the data for submission to monetizer | 0-4 hours |
| MONETIZATION | |
| 1) Client’s paperwork is submitted to monetizer. | 15 minutes |
| 2) Monetizer does due diligence on data | 24-72 hours |
| 3) Magister Operis introduces client to monetizer and arranges conference call | 24 hours |
| 4) Monetizer and client have a conversation to get on the same page with each other | 15 minutes to 1 hour |
| 5) Attorneys are introduced to each other to draft contracts | 30 minutes |
| 5) Monetization lawyer issues draft contract to client for review. | 24-72 hours |
| 6) Client signs monetization contract. | 10 minutes |
| 7)Client blocks asset as agreed on behalf of monetization bank. | 1-72 hours |
| 8) Monetization banker deposits monetization funds into client’s account as per contract. | 30 minutes |
| 9) Intermediaries paid as agreed. | 15-60 minutes |
| *** DURATIONS NOTE: Please understand that the above time durations are simply educated guesses of what might be reasonable. Actual times will vary due to the quality or lack of quality as well as time constraints of the signatory principals, assets, intermediaries, documentation, legal counselors, pandemics, custodial institutions, and/or banks. | |
WARNING: There are various parties globally... claiming to be "banks/issuers" that have neither credibility nor cash behind them. Their company name might sound like something "official" like some sort of bank... but research will evidence that that they have ZERO credibility as a bank and/or as a collateral provider.
Due Diligence: CLICK HERE
Fake Documents/People: CLICK HERE
Magister Operis Workflow: CLICK HERE
General LTV Information: CLICK HERE
Broker Notes: CLICK HERE
Disclaimer: CLICK HERE