Corporate Executive Services External Loan Payoff Process
CONTACT INFORMATION
Operational Support Team
Financial Solutions
Carmen Valle
Alona Broadway
Sales, Marketing, Positioning, Consulting, Training
Amit Khanna – Financial Solutions
Main Hotline: 877-778-7248 Option #1
Mon – Fri (9am – 5pm EST)
Service Center Path: Corporate Executive
Service_LoanAdvance_General Inquiry
201-413-2998
akhanna@pershing.com
Fax # 201-413-4564
EXTERNAL LOAN PAYOFF REQUIREMENTS
1. Confirm that your client’s legal address is in an eligible state/country approved for
LoanAdvance.
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Program unavailable to residents of Nevada, and Vermont
Mississippi, Rhode Island, and Washington D.C are for Business use only
2. Confirm that the loan at the contra firm was used for non purpose.
3. Provide to CES email or fax the most recent customer statements from the non purpose
loan account (debit account) and all cross guarantee accounts (collateral accounts) at
contra firm.
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Symbols or CUSIP’s must be disclosed on the statements for the collateral
review.
Most current/recent statement will be the prior month’s statement. (Example: If
request is being submitted August 1, than we will accept June Statements. If the
request is submitted after August 7th than July Statements are required.)
4. Introducing firms that are participating in LoanAdvance Managed Account program for
the first time should execute an amendment to the fully disclosed clearing agreement.
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If your firm is not a participant of the managed account program and a managed
account is going to be used than you must present a confirmation of the type of
managed account being used. Acceptable account must meet Pershing’s criteria.
5. All ACH, periodic instructions, checks and debit cards need to be cancelled from the
client’s account at the contra firm prior to paying the loan off.
6. Ensure that all cross collateral accounts are for the same client (same SS # or Tax ID)
otherwise, Guarantee of Account Form will be required.
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7. Provide a direct contact at the contra firm to CES. If not available, then it may delay the
payoff and transfer process.
8. Establish the client’s LoanAdvance account in the designated LoanAdvance office range
using the appropriate account category codes: NPLI (Individual), NPLJ (Joint), NPLC
(Corporate), NPLT (Trust), NPLP (Partnership).
9. Confirmed that all cross guarantee/Managed accounts are not set up with:
_Margin
_ Bank Link
_Corestone Debit Cards
10. Required Forms:
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Interest Rate Disclosure form
Lending Agreement
Federal Form T-4
LOI (Letter of Instruction)
Transfer Forms
Supporting Documents (if applicable)
Loan Advance Check Writing Application (if applicable)
Obtain Guarantee of Account Form for third party managed accounts that will be
securing a Non-Purpose loan. – Must be some affiliation between the guarantors. (if
applicable)
1. The purpose for Non-Purpose Loan stated on the T4 request must state:
To pay off existing NPL at: Reference Name of contra firm, which was used for:
purpose of loan.*
2. Confirm all documents have the NPL account # and are signed by the customer and IBD
in the appropriate areas.
3. On the Transfer Form the Full In-kind transfer should be checked off as well as the type
of transfer ACAT or NON-ACAT*
 The Receiving Account as well as the Delivering account information must be
provided.
 Clearing number at the contra firm.
4. Once all the documents are in good order please send them via email to Corporate
Executive Services.
Note:
The customer must include any additional purpose*(s) on the T4 form, if the T4 amount
is significantly higher than the payoff amount.
NON-ACAT transfers require original transfer forms with a Medallion Guarantee
Stamp, and must be sent overnight to Pershing/CES prior to payment being issued to
Contra Firm.
CES RESPONSIBILITIES
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Corporate Executive Services will work with the broker-dealer and the financial
institution(s) holding the loan and assets to facilitate the transfer.
CES will confirm if IBD has enough net capital to support the unsecured payment.
CES will submit the statements for review to ensure the assets meet Pershing’s release
requirements.
CES will provide the approved amount to IBD.
CES will review all the required documents and provide all pending issues to IBD.
CES will contact the Contra Firm - fax client’s LOI and payoff letter
Once payoff letter is received from the Contra Firm, CES will submit the loan for final
approval.
CES will call the IBD on a recorded line and send a service center request confirming the
payoff amount.
CES needs final approval from Credit Risk / CES Management team
Once everything is in good order, CES will submit the payment to Contra Firm. Client’s
account will be left unsecured.
CES will contact the Contra Firm to ensure they have received payment and confirm the
liens/blocks were removed.
CES will contact the Contra Firm’s ACAT department before submitting ACAT Form.
CES will monitor the ACAT daily until the assets are received by Pershing.
EXTERNAL LOAN PAYOFF PROCESS TIME TABLE*
Preliminary Statement Review
2-3 business days for Statement/Collateral Review
Documentation and Account Review/Approval
24 hours for review of required/ supporting documents
and NPL Account/Collateral Account profile.
Payoff Demand
3-5 business days, this may vary according to the Contra
firm’s internal policy and procedure.
Payment Approval/Payoff Initiation
24 hours once payoff amount is received and approved
by Pershing’s Credit Risk team.
Confirmation of Payment Received and Lien
Removal
2-3 business days for Contra firm to confirm receipt of
funds and release the liens on the collateral. (This may
vary according to the Contra firm’s internal policy and
procedure.)
Transfer of Assets
ACAT deliveries can take up to 5-7 business days, NONACAT deliveries can take 10 business days or more
depending upon the security type, i.e. Mutual Funds
coming from The Fund
*Note: Please note that the actual time may vary between Contra Firms. Assuming all
documents have been received in good order.
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L E T TE R O F I N S TR U C T I O N
DATE:
TO
C L OS E
AND
DELIVER
RE: PERSHING LOANADVANCE ACCOUNT: _ _ _ - _ _ _ _ _ _
TO: “FINANCIAL ADVISOR”
Please wire transfer out of my LoanAdvance account to pay off the existing Non purpose Loan plus accrued
interest at
(Receiving Bank). The [loan activity] reflected on the
statements for account #______________ relates to a Loan Advance Program. I attest that the loan being
paid off is a non purpose loan with no other liens on the collateral supporting the loan. The contra firm will
need to confirm that the client is not going to increase the loan during the payoff process.
Please keep in mind that, to comply with applicable federal regulations, all loans made to you under the Non
Purpose Loan Program must be made for a purpose other than: (1) to purchase or trade in securities; (2) to
meet margin calls relating to securities purchases; or (3) to repay indebtedness incurred to purchase
securities.
________________________________________________________________________________________________
Re: __________________________________ (Bank Name)
Bank NPL Account Number: _______________________________
To: ______________________________________________________ (Bank Name)
Pershing LLC (“Pershing”) will pay off the outstanding loan held at ________________ (Securities Firm) in my
NPL account __________________, whereupon I request that you close said account and deliver the assets
in account(s) ________________, _________________, _________________ used to collateralize said loan to
Pershing.
I agree the assets referenced in the statements for the collateralized account(s) are locked and cannot be
traded, liquidated or removed until assets are received to Pershing LLC.
This instruction is not revocable or amendable by the undersigned. I hereby grant to Pershing the power,
coupled with an interest, to affect the intent of this letter. You may expect a call from Pershing to confirm the
prompt delivery of the securities and to arrange proper receipt by them. If the holds are not removed within
48 hours, and assets are not delivered to Pershing within 10 business days from receipt of wire, then the
payoff monies will be requested to be returned to Pershing by the end of the 10th business day.
The client further acknowledges and agrees to stop all advance requests on their loan including use of any
checks, bill pay/ or debit cards. Additionally, the client affirms that there are no issued and outstanding
checks.
Signature:
_____________________
Print Name: _____________________
Signature:
______________________
Print Name: ______________________
(JTWOS, Trustee, etc.)
TEXT OF THE LETTER OF INSTRUCTION MAY NOT BE ALTERED IF REPRINTED BY YOUR FIRM.
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