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Brad Williamson
Plano, TX
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"The team works together well with all parties which allows us to focus on our business of selling insurance and taking care of our clients, instead of worrying about our loan and closing on time."
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| Greetings! | Welcome to the February edition of Allstate Management Monthly. Included in this issue is an introduction to PPCLOAN's 'Knowledge Center,' a brief Banker's Insight exploring cash flow and TPP, an invitation to discuss Allstate Bank's recent changes, and deal highlights for January. Enjoy!
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Knowledge Center
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Here at PPCLOAN, we like to share our industry knowledge with all of the parties involved in Agency ownership transactions. We accomplish this by sending out various newsletters and publications such as Allstate Management Monthly and our Allstate Agency Value Index. Another useful tool we have readily available is our 'Knowledge Center' which can be found on the Allstate section of our website. The Knowledge Center offers valuable information regarding all things Allstate that have been collected from various articles and presentations. The Knowledge Center also includes multiple financial tools: These tools can be used to assist prospective buyers in the transaction process.
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Banker Insight
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Cash Flow vs. TPP
How does the TPP affect the Bank's loan amount? This is a question commonly posed by Allstate Agents and Management alike. Simply stated, the TPP is taken into consideration but is not pivotal in determining the loan amount. If the TPP value of an Agency is $400,000, but the cash flow can only support $300,000 in outstanding debt, the bank will only lend the latter amount. At the same time, however, the bank will lend well over three times TPP if the cash flow supports it. In summary, the bank knows that the cash flow is what makes the monthly payment, not the TPP.
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Allstate Bank
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How will the sale of Allstate Bank affect their lending to Allstate agents? PPCLOAN is interested in hearing your response and other comments, which you can email to eric@ppcloan.com. Here are two articles, one from bloomberg.com, and one from wsj.com, that further explain Allstate Bank's situation.
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| AllstateForSale.com | Refer to AllstateForSale.com to find updated agency listings in your area. With over 100 nationwide listings, AllstateForSale.com is quickly becoming a resource for agents to list and identify available agencies.
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Deal Highlights
| Outside Buyer in New Mexico
Purchased and merged two agencies totaling $3.6EP for 1.83 times. PPCLOAN was able to fund 100% of the purchase, plus and additional $25,000 for working capital.
Outside Buyer in Pennsylvania Purchased a $1.9EP agency for 2.33 times. PPCLOAN was able to provide $390,000 toward the purchase price with the buyer injecting the remainder of the capital needed as a down payment
Existing Agent in Indiana PPCLOAN was able to refinance and consolidate $1,250,000 in agency debt, lowering interest over 2 percentage points.
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CONTACT US
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Our Allstate Team is always available to assist your agents with their financing needs.
9303 New Trails Drive, Suite 375 ~ The Woodlands, TX 77381
Toll-free: 800.456.2779 | Phone: 281.419.0400 | Fax: 281.419.8309 | Email: info@ppcloan.com
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