Dealers and collectors become guarantors for various reasons besides the financing fee.
If he chooses to be the guarantor, he can either win the work or win a financing fee or both.
Its new offering, called Next, "can get you a new device every year with no down payment, no upgrade fee, no finance fee and no activation fee".
Their hope is to grab a bigger slice of one of the few corporate finance fee pools that's expected to grow nicely in 2011.
Christie's and Phillips said that they allowed guarantors to earn a financing fee, even if they bid successfully for a work, because to do otherwise might dissuade them from bidding and, thus, deprive a seller of the best price.
Barclays comes across as concerned not with its client Del Monte, but solely with obtaining a second financing fee and aiding its private equity clients to the detriment of the target companies.
If bidding is more robust, then the guarantor receives a financing fee (calculated, usually, as some fraction of the difference between the guarantee and the final price, plus half the buyer's premium).
The financing fee varies based on the lender's risk assessment.
When a sponsor charges every fee possible to the investor (acquisition fee, asset management fee, financing fee, disposition fee, etc). and wants to share disproportionately in the operating cash flow before the investment is a success and then takes a level of carried interest not commensurate with the risk in the deal, it's time to move on.
Add together the net cap cost and the residual cost and multiply the sum by the money factor to determine the total finance fee.
