broker's loan

(redirected from Broker Loan)

Broker's Loan

A loan to a broker or brokerage by a bank. Brokers take out broker's loans usually to fund margin accounts for their clients, but also to fund underwriting purchases. Occasionally, brokerages borrow these loans to buy securities for themselves as well. Broker's loans are payable on 24 hours notice, and carry interest rates that are about one point higher than short-term rates. See also: Broker call loan.

broker's loan

Funds borrowed by a broker, mainly from banks, for various purposes including a call loan for purchases of securities on margin, an underwriter's purchase of a new security issue for resale, or a specialist's inventory of securities. Also called general loan and collateral agreement.
References in periodicals archive ?
He then sells the borrowed stock through the same broker,and the proceeds of the short sale earn interest at a broker loan rate, which is currently approximately 5 percent.
In the broker-financed transaction, the broker loan could be increased to cover the tax liability.
An example of this new generation of broker portals is Houston-based Aegis Mortgage Corporation's Aegis Broker Loan Enabler (ABLE) portal.
All of IndyMac's broker loan submissions are made online, says Wagner.
Liberty is also using GHR's Wholesale Origination Web site to streamline broker loan origination.