Advance Rate

Advance rate is the fraction of a facility's collateral value that the lender will advance as credit. On a policy cash-value line of credit (IBLOC or CVLOC), an advance rate of 95% means the lender will extend a credit limit up to 95% of the pledged cash value.

The advance rate is a term set by the lender. Policy Stack records it as a recorded value on the facility so the relationship between pledged cash value and the Credit Limit is visible. It is not a figure Policy Stack calculates or projects.

Related terms: Credit Limit, Available Credit, IBLOC, Cash Value