NON REGISTERED BORROWING

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NON REGISTERED BORROWING

 
Releasing Security in Cash or In Kind
You may require Mackenzie to release security to you at various times. This is permitted on both loans subject to specific terms and conditions. On the Wealth Builder with Interest Only Payments, security may be released to the borrower provided the subsequent loan to value ratio doesn't exceed 75%.

IMPORTANT: Security may be released on a Wealth Builder loan (with principal and interest payments) only to the extent of growth beyond the initial amount borrowed and invested. For example, a client that borrowed, say $50,000, may only take away security from the loan above the $50,000 level. Here's an example:

       
Original Loan
Amount		 Current Loan
Balance		 Original Value of Mutual Funds Current Value of Mutual Funds
$50,000 $47,000 $50,000 $55,000

In this example, the maximum amount of security the client would be entitled to is $5,000 as their funds have grown by $5,000 over the original loan amount. There is no loan to value relationship in calculating how much security may be released to your client. The only factor to consider is the amount of market value excess over the original amount borrowed.