Flooring Finance Definition

Floor planning is a type of inventory financing for large ticket retail items.

Flooring finance definition.

Using cash or a bank line of credit to purchase inventory can work for some car dealers but many floor plan financing companies offer a variety of dealer specific benefits. In context of interest rates a level which an interest rate or currency is structured not to go below. A floor in finance may refer to several things including the lowest acceptable limit the lowest guaranteed limit or the physical space where trading occurs. They are most frequently taken out for periods of between 2 and 5 years although this can vary considerably.

Also the price at which a stop order is activated when the price drops low enough to activate such an order. A flooring account is a type of short term financing that is used specifically for equipment purchases. What you don t realize is that like most new car dealers a floor plan was used to finance the cars. The dealer then receives payment hopefully including a profit and remits the balance to.

In context of otc interest rate options a series of interest rate put. Floor the area of a stock exchange where active trading occurs. An interest rate cap is a derivative in which the buyer receives payments at the end of each period in which the interest rate exceeds the agreed strike price an example of a cap would be an agreement to receive a payment for each month the libor rate exceeds 2 5. In addition to freeing up the cash a dealer has on hand other floor plan financing benefits.

It is often referred to in the it industry regarding credit lines for computer equipment.