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How to Use Securities Based Lending to Borrow Against Your Stocks

January 03, 20243 min read

So you have been investing in securities for a while. Have you ever wondered if you can get more out of your investments? You may think the only option available is selling your stock.

Yet, that's far from the truth. Securities based lending lets you borrow against stock without selling. Not sure if getting this loan is right for you?

We've you covered. We'll tell you how a stock secured loan works and why you should consider it.

Read on to learn more today.

Securities Based Lending: The Golden Goose Many Investors Don't Know About

It might be the first time you hear about getting a loan against stocks. Yet, these loans are becoming more and more popular.

These loans are non-recourse loans different to the typical loan. It means that the lender will seize the collateral due to failed repayment. But, they can't go against any of your other assets.

One of the benefits of borrowing against your investments is that you won't have to put down collateral out of your pocket.

Instead, you will be using stock as collateral on your loan. It's a win-win situation for any investor because they can use their investments as more than their retirement safety net.

You can only borrow these loans against non-marginable securities. This term refers to stocks that can't be bought on margin. Investors must purchase them using their own cash.

Some examples of non-marginable securities are initial public offerings (IPOs), penny stocks, among other investments. Most lenders accept non-marginable stocks in certificate or DWAC form that trade on the NYSE, NASDAQ or other Over-The-Counter Markets.

When you take this loan, you transfer your stocks and agree to make quarterly payments to the lender. The lender will provide a loan against the value of your investments and transfer them back to you after full repayment.

Your loan amount will depend on the securities value, volatility, number of shares, among other details. It can range from 50,000 to 5,000,000 dollars.

These loans provide fast funding. We can fund your loan within 48 hours.

Best of all, we won't check your credit or charge any upfront fees. The loan term can vary between 24, 36, and 60 months at a rate based on the current prime rate. It's recommended that you contact your lender to learn more about your eligibility and lock your rate.

Is a Stock Secured Loan Your Best Option?

Yes, securities based lending may be your best option. As an investor, you should be able to get the most out of your investments. Have you owned your stocks for a long time?

Wish you could do more with them than saving for your retirement? If you answered yes, a stock secured loan can help you get the most out of your investments.

Many customers use them to fund their start-ups or even buy their dream vacation home. Keep in mind that the loan amount and eligibility of your stocks will depend on your lender.

Want to get a loan against stocks? We can help. Contact us today to learn more about our securities lending solutions.


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The information contained herein is presented solely for the purposes of discussion and under no circumstances should this be considered an offer to buy or a solicitation of an offer to sell any security. Stock Loan Solutions is not a registered securities broker-dealer or an investment adviser with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. Stock Loan Solutions, its managers or affiliates have not been registered and do not plan to be registered under the Investment Advisers Act of 1940 or any similar state or foreign securities laws. Stock Loan Solutions is not registered under the Investment Company Act of 1940 or under any similar state or international securities laws. Stock Loan Solutions does not offer any form of investment (buy or sell) advice, tax counseling, estate planning, or any other securities or financial advice whatsoever. No statements on this website or any verbal or written statement by any representative shall be construed as such advice. We are neither licensed nor qualified to provide investment advice.

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