Asset Based Lending
Asset-based loans (ABL) are typically used by businesses to fund working capital needs and are secured by current assets, I.e. accounts receivable, inventory, equipment or real estate. They are particularly well-suited for companies with cash conversion cycles under 150 days.
Highlights
Check Size
From $1 million to $50+ million. Flexibility to increase line size over time
Rate
Start at Prime +1. Rate varies based on collateral and risk profile
Security
UCC1 security interest. Can carve out assets for other lenders in the capital stack.
Time to Close
Typically 3–5 weeks from signed term sheet.
Term
2-3 year term with an auto renewal. Structured to support ongoing capital requirements until a bank takeout