** This thread discusses the content article: New Availability of Financing for Domestic and Foreign Buyers of Fractional Real Estate **

David, what is the relationship between your company, Securities Based Fractional Funding (SBFF) and Equities First Holdings LLC (EFH)?

Our company, SBFF, is the "sole exclusive worldwide representative for securities based lending to fractional developers and purchasers of fractional interests, with the sole and exclusive right to offer the EFH loan product.”

In addition, while not exclusive, our company can also originate the EFH Securities Based Lending program for the prompt funding of loans for other real estate and non-real estate loan transactions.

This program sounds like a typical margin loan. Are there differences and if so, please describe them.?

Our securities based loan is superior in all aspects as compared to the typical margin loan. Some of the major advantages of our loan are:

• Our loan product is 100% non-recourse; borrowers have no personal liability. In contrast, the typical margin loan is fully recourse and additional liabilities, fees and penalties may be assessed.

• Our loan has a below market fixed rate for the loan term. The typical margin loan is a variable rate loan with short interest rate adjustment periods, which can sometimes be daily. After initial adjustment periods, the typical margin loan interest rate will generally exceed our fixed rate loan.

• The loan amount of the margin loan cannot exceed 50% of the market value of the pledged stock and by regulation, not all securities are eligible. The EFH loan amount can be as high as 80% of the market value of the pledged security and many more securities are eligible for our loan product.

• In a margin loan, if the value of the pledged securities falls below 80% of the market value used to determine the loan amount, the loan is subject to an immediate "call". The owner has 24 hours within which to respond to the call and increase the collateral or lose the stock and remain personally liable for any deficiency. In contrast, with the EFH loan program, should the value of the pledged securities fall below 80% of the loan amount (a huge difference) for three consecutive days a five day call provision can be invoked. If the value of the stock pledged to EFH increases to a level above the call point anytime during the call period, the call will be nullified. If the stock value does not increase, the borrower has five business days within which to increase the amount of the collateral or walk away from the loan without additional liability or adverse impact to their credit report.

For what types of individuals might this program be appropriate?