Floor Financing Agreement

Every time a new dealer agreement new floor plan agreement or new bank agreement is presented a dealer should compare the collateral descriptions with other financing documents.

Floor financing agreement. What you don t realize is that like most new car dealers a floor plan was used to finance the cars. Retailers use a short term loan to purchase inventory items and the loan is repaid as inventory is sold. They are most frequently taken out for periods of between 2 and 5 years although this can vary considerably. This agreement means the floor plan financing agreement.

These loans are made against a specific piece of collateral i e. An interest rate floor is an agreed upon rate in the lower range of rates associated with a floating rate loan product. Floor plan agreement. The dealer then receives payment hopefully including a profit and remits the balance to.

Avangard a corporation organized under the laws of the state of pennsylvania having its principal place of business at 2708 commerce way suite 300 philadelphia pa 19154. Floor planning is a type of inventory financing for large ticket retail items. How does floor plan financing work specifically to benefit auto dealers. This dealer floor plan and security agreement the agreement is made as of september 28 2007 by and among fountain dealers factory super store inc a north carolina corporation borrower regions bank an alabama state banking corporation together with its successors and assigns lender fountain powerboats.

An interest rate cap is a derivative in which the buyer receives payments at the end of each period in which the interest rate exceeds the agreed strike price an example of a cap would be an agreement to receive a payment for each month the libor rate exceeds 2 5. An auto rv manufactured home etc. And autosource enterprises inc. Interest rate floors are utilized in derivative.

Using cash or a bank line of credit to purchase inventory can work for some car dealers but many floor plan financing companies offer a variety of dealer specific benefits. If the same collateral is being used to support more than one loan there is likely a problem that needs to be addressed by changing the collateral description. In this agreement we us and our mean regions bank you and your mean the borrower. When each piece of collateral is sold by the dealer the.

Simply it is a way for an auto dealer to use a lender s funds to finance the cars and until each of them is sold the lender holds title to the cars. This agreement made this 13 th day of february 2012 by and between avangard auto finance inc. Capitalized terms used in this agreement and not otherwise defined are used with the meanings set forth in schedule i any undefined terms shall have the meaning as set forth in the alabama uniform commercial code.