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If you're looking to purchase large equipment, meet requirements for bonding on a construction project or even hoping to establish a relationship with new suppliers, we'll vouch for your business.
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Contact your local FirstBank to speak with a loan officer.
How can we help grow your business?
At FirstBank, we get to know your business to determine the right financing approach and don't require you to fit in a box. Click the button below to tell us about your business goals and we will be in touch within one business day.
What is a Letter of Credit?
An instrument of credit issued on behalf of a customer to assure payment for goods and services. A letter of credit is an obligation of the issuing bank to the beneficiary, based solely on the terms and conditions of the instrument itself. Letters of credit may be revocable or irrevocable.
Irrevocable - The letter of credit is a definite commitment of the issuing bank provided that the stipulated documents are presented and that the terms and conditions of the letter of credit are met. An irrevocable letter of credit may be amended or canceled only with the agreement of all parties to the letter of credit.
Revocable - The letter of credit may be amended or canceled at any time by the issuing bank.
Letters of credit may also be payable upon sight or payable by time draft.
Sight - Payable upon presentation of required documents by the issuing bank.
Time - Payable at a date after presentation as stipulated by the letter of credit terms, as evidenced by a time draft to be drawn by the beneficiary for acceptance or on a deferred payment basis per the letter of credit terms.
How Much Does a Letter of Credit Cost?
We charge 2.0% per annum, but not less than $250, to cover documentation costs. Example: a one-year letter of credit is charged 2.0%, a six-month letter of credit is charged 1.0%, but never less than the $250 minimum fee.
I Still Have Questions.
Great! That's what we're here for - to help your business grow and become even more successful. We're happy to discuss the details of letters of credit or anything else that may be on your mind. Contact a loan officer today at 855-426-1500 or complete a quick form and we'll contact you when it's convenient.