Using TD Ameritrade margin for down payment?

Question

Anyone done this?  I have a substantial portfolio there and it seems I could get a margin loan to pay a downpayment on an investment property for a short period of time.

Interactive Brokers has significantly lower margin interest rates so I may consider moving my portfolio over there.

Steve S. · Answer

Thank you for the thoughts.  The purpose of this would be to lock in on a good deal ahead of interest rates rising and pay it off in 6 months or less.  If I sell stock, I trigger some significant capital gains in stocks i plan to hold longer term so I'd prefer to avoid that.

The other option is wait until I have more cash accumulated, but by then, this deal will be gone.

Account Closed · Answer

I cashed out of the stock market myself a few years back to start up my investment property portfolio, as I just grew tired of the unpredictable volatility game that comes with making money based on what everybody else does in the stock market aka out of my control.

My money is doing so much more for me now in real estate, growing in more ways than one, under more my control with the ability to move it with more ease minus fees and penalties.

Of course I'm not totally out of the stock market, as I still have money invested in some mutual funds through my employer and a HSA account. But again like I said that is out of my control as I can't touch that money until after I resign my employment, which I plan to do in less than 6 years when I hit my early 50's and my primary residential house is scheduled to be paid off.

Steve S. · Answer

Anyone done this?

Dennis Weber · Answer

Stock market refugee here. I'm all for selling stocks to invest in real estate where YOU have control over your money.

Anthony Dooley · Answer

I think that would be absolutely stupid, but you asked.  Why not sell some shares or take a loan against your 401k for a short period of time.  I don't even know if they would let you borrow on margin to invest outside of paper assets, but I would never do it. They can call your marker at any time.