APR 5.99% – 35.99%·$100 – $50,000

Get Advance Loan
Head to head

Personal Loan vs. Margin Loan: Borrowing Against Your Investment Portfolio.

If you have a taxable brokerage account, you can borrow against your securities (stocks, ETFs, bonds) through a margin loan at rates of 7%-12% - often less than a personal loan. The trade-off: if your portfolio drops enough that the loan exceeds the allowable percentage of your portfolio value, you face a margin call requiring immediate repayment or additional deposits. Market timing and forced selling make margin loans risky during volatility. Personal loans carry no investment risk.

Side by side

Personal Loan vs Margin Loan

AttributePersonal LoanMargin Loan
Rate (2026)8%-25% APR depending on credit7%-12% (variable, based on broker's margin rate)
Collateral requiredNone (unsecured)Investment portfolio (securities in taxable brokerage account)
Credit checkYesNo (access based on portfolio value)
Repayment requirementFixed monthly paymentsFlexible - pay interest as incurred; repay principal anytime
Margin call riskNoneIf portfolio drops below maintenance margin (typically 25%-35%), must deposit cash or sell securities immediately
Maximum loan amountLender maximum ($50,000-$100,000 for most unsecured lenders)Up to 50% of marginable portfolio value (Regulation T initial margin)
Tax implications of borrowingInterest not deductible for personal useInterest may be deductible against net investment income (investment interest expense)
Verdicts by scenario

Which wins, when.

  1. 01

    You have a stable portfolio of diversified stocks and need 6-12 months of liquidity

    Winner: Margin Loan

    Margin loan rates are typically 2%-10% lower than personal loan rates for the same borrower. If your portfolio is stable and well-diversified, margin call risk is manageable. The interest may also be tax-deductible against investment income.

  2. 02

    You hold concentrated, volatile positions (individual stocks, crypto) in the portfolio

    Winner: Personal Loan

    A 20%-30% drop in a concentrated position can trigger a margin call within days. Forced selling of volatile assets often happens at the worst prices. A personal loan eliminates this risk entirely.

  3. 03

    You do not have a brokerage account or your assets are in retirement accounts (IRA, 401k)

    Winner: Personal Loan

    Margin loans require a taxable brokerage account - IRA and 401k assets cannot be used as margin collateral. For most borrowers, a personal loan is the accessible option.

  4. 04

    You want to borrow more than most personal loan maximums ($50,000-$100,000)

    Winner: Margin Loan

    Margin loans can access up to 50% of a large portfolio's value. If you have $500,000 in a taxable brokerage account, you can potentially access $250,000 via margin - far exceeding most personal loan limits.

Common questions

Frequently asked.

What is a margin call?+

A margin call occurs when your portfolio value falls enough that your outstanding margin loan exceeds the allowable percentage of your portfolio value (maintenance margin, typically 25%-35% of total portfolio value). Your broker notifies you and requires you to: deposit additional cash, sell securities to pay down the loan, or transfer additional marginable securities into the account. If you do not meet the call, the broker may sell your securities unilaterally to bring the account into compliance - often at disadvantageous prices during a market decline.

Are margin loan rates fixed?+

No. Margin loan rates are variable and set by each broker based on the federal funds rate plus a spread. When the Fed raises interest rates, margin loan rates increase. In 2022-2023, many brokers raised margin rates from 4%-6% to 11%-13% as the Fed hiked aggressively. This variability is a risk that personal loans (with fixed rates) do not carry.

Is margin loan interest tax deductible?+

Margin loan interest used to purchase securities may be deductible as an investment interest expense on Schedule A (up to net investment income for the year). Excess interest expense is carried forward to future years. However, margin loan interest used for personal expenses (not purchasing additional investments) generally is not deductible. A personal loan's interest is almost never deductible for consumer use. Consult a tax advisor for your specific situation.

Other comparisons

Compare real personal-loan offers.

Begin a request