Asteron Life: Response to coronavirus
Deep dive into client base valuations - and a comment on risk

The problem of vendor financing your client base sale

A common way to help a younger (and often, less wealthy) adviser buy your client base is through vendor financing. Often the loan is secured against the client base. Which sounds fine. In fact it was fine, back when all you needed in order to manage a client base was to be a Registered Financial Adviser. After all, if you were selling a client base, you were already an RFA. But selling a base in this way no longer works in an environment with changed agency requirements. New agency terms appearing now, changed to reflect the implementation of FSLAA and with provisions for expected conduct law, require that an adviser must be appropriately licensed. So if you vendor finance you need to maintain your license status. That may suit some, but won't meet the needs of those that are selling in order to avoid having to do just that. 


Feed You can follow this conversation by subscribing to the comment feed for this post.

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Your comment could not be posted. Error type:
Your comment has been saved. Comments are moderated and will not appear until approved by the author. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.


Post a comment

Comments are moderated, and will not appear until the author has approved them.

Your Information

(Name is required. Email address will not be displayed with the comment.)