Letter of Credit
Provide assurance to your vendors that they will receive full payment of a contract under any circumstance. By initiating a letter of credit, you provide proof of your credit and ability to repay to any third party.
- Summary
- Available from $1,000 to $1.5 million
- 1 year term
- Opportunity for renewal at end of term
- How It Works
By securing a standby letter of credit (SLOC), you (the buyer) are providing a third party (the seller or creditor) proof that they will receive full payment according to contractual commitment. Essentially, it is a payment of last resort should you fail to make payment for any reason.
You will make standard payments to the seller according to the contractual guidelines. But if you fail to make payments, the seller can cash in the SLOC with the issuing bank (Mountain West Bank). We will then make the payment to the seller on your behalf. At this point, you will owe the funds to us, to be repaid as a loan.
