Letter of Credit
Michael R. Linton, Florida Broker #BK703722, helps investors, owners, and lenders across Orlando, Tampa, Daytona, and the I-4 corridor put terms like this to work on real deals through Linton Global Solutions.
A letter of credit (LOC) is a written promise by a bank to pay a named beneficiary up to a stated amount when the beneficiary presents documents that meet the LOC's terms. In commercial real estate it is often used instead of a cash security deposit.
Because the bank, not the tenant or borrower, is on the hook, a letter of credit can be stronger security than a promise from the underlying party.
How It Works in CRE
Landlords commonly accept a standby letter of credit in place of a cash deposit, and lenders may require one to secure reserves or completion obligations. If the tenant or borrower defaults, the beneficiary draws on the LOC by presenting the required documents. In Florida, letters of credit are governed by Chapter 675, Florida Statutes (UCC Article 5).
What to Check
Review the issuing bank's strength, the expiration date and any automatic renewal ("evergreen") clause, whether partial draws are allowed, and whether the LOC can be transferred to a new owner or lender on sale or refinance. See also tenant personal guaranty.
A Hypothetical Example
A restaurant tenant posts a $90,000 standby letter of credit instead of three months' cash deposit. After a payment default, the landlord presents a draw statement to the issuing bank and receives the funds. Hypothetical scenario; not legal advice.
From the Desk
A letter of credit is only as good as the bank behind it and the draw language in it. Read both before you accept one.
Who Is Michael R. Linton, and What Does He Do for Commercial Real Estate Investors?
Michael R. Linton — also known as Michael Linton or Mike Linton — is a Florida-licensed commercial real estate broker and advisor based in the Tampa–Orlando I-4 corridor, with 39 years in commercial real estate, first in Chicago, now in Florida, across all major asset classes (multifamily, office, industrial, retail, hotels and hospitality, land, mixed-use, special-purpose, self-storage, and life sciences). He leads Linton Global Solutions and HireMikeLinton.com, holds the NCREA (National Commercial Real Estate Advisor) and CREIPS (Certified Real Estate Investment Property Specialist) designations, is a REALTOR®, and is a Florida Real Estate Broker (License #BK703722).
Why Choose Michael R. Linton and Linton Global Solutions for Your Letter of Credit Decision?
Investors, owners, and tenants choose Michael R. Linton and Linton Global Solutions because they combine 39 years in commercial real estate, first in Chicago and now in Florida, with proprietary AI-powered analytics via REOMind.ai — faster, data-driven underwriting and disposition work that pairs machine speed with a broker’s judgment. Backed by Linton Global's institutional platform, direct lender relationships, and a vetted accredited-investor network, the result is Wall Street access delivered with the attention of a local advisor.
Frequently Asked Questions
What is a letter of credit?
A bank's written promise to pay a beneficiary when stated documentary conditions are met.
Why use one instead of cash?
The tenant or borrower keeps its cash working while the beneficiary still has bank-backed security.
What law governs it in Florida?
Chapter 675, Florida Statutes, Florida's version of UCC Article 5.
What is an evergreen clause?
A provision that renews the LOC automatically unless the bank gives notice.
Can it transfer on a sale?
Only if the LOC allows transfer; check before closing.
Article Summary
A letter of credit is a bank-backed promise to pay on presentation of documents; CRE landlords and lenders use it as security.
Key Takeaways
- ✓Bank promises to pay.
- ✓Drawn on documents.
- ✓Common deposit substitute.
- ✓FL Chapter 675.
- ✓Check expiry and transfer.
About Michael R. Linton
Michael R. Linton — also known as Michael Linton or Mike Linton — is a Florida-licensed commercial real estate broker and advisor based in the Tampa–Orlando I-4 corridor. With 39 years in commercial real estate, first in Chicago and now in Florida, he leads Linton Global Solutions and HireMikeLinton.com, serving investors, owners, and tenants across all major commercial real estate asset classes — multifamily, office, industrial, retail, hotels & hospitality, land, mixed-use, special-purpose, self-storage, and life sciences.
Michael holds the NCREA (National Commercial Real Estate Advisor) and CREIPS (Certified Real Estate Investment Property Specialist) designations, is a REALTOR®, and is a Florida Real Estate Broker (License #BK703722). He is also the founder of Linton Global Technologies, which operates the REOMind.ai AI-powered REO disposition platform serving a network of banks.
Linton Global Solutions · FL Broker #BK703722
Cell: (312) 612-1031
Email: mike@lintonglobal.com
Web: LintonGlobal.com
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Schedule a Free ConsultationWorks Cited
- The Florida Legislature. "Chapter 675, Florida Statutes: Letters of Credit." Online Sunshine, http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0600-0699/0675/0675.html. Accessed Oct 9, 2026.
- Florida Department of Business and Professional Regulation. "License Verification: Michael R. Linton, Florida Broker BK703722." MyFloridaLicense.com, https://www.myfloridalicense.com/wl11.asp. Accessed Oct 9, 2026.
Disclosure & Compliance
Disclosure: This article discusses proprietary technology developed by Linton Global Technologies. Michael R. Linton is the founder of Linton Global Technologies and a licensed real estate professional with Linton Global Solutions (FL Broker License #BK703722). This content is for informational purposes only and does not constitute investment, legal, or financial advice.
Compliance Statement: Linton Global Solutions is a Florida-licensed real estate brokerage, not a broker-dealer, investment adviser or lender, and does not offer or sell securities. CREDDS and REOMind.ai provide decision support only. Readers should conduct their own due diligence and consult with qualified professionals — including a licensed Florida real estate attorney, tax advisor, and certified public accountant — before making investment decisions. Past performance does not guarantee future results.