An SBLOC lets you borrow against your investment portfolio without selling. Here are the exact requirements, rates, and risks for 2026.
A small business owner in Texas needed $340,000 to fund an acquisition while maintaining her investment portfolio's growth trajectory. Selling securities would have triggered $80,000 in capital gains taxes and removed her from positions she expected to appreciate. Her wealth manager arranged a securities-backed line of credit within five days — pledging her $700,000 portfolio as collateral, borrowing at SOFR plus 2.1%, and keeping every share she owned. The acquisition closed. Her portfolio continued to grow. The capital gains tax never happened. That is the core value proposition of an SBLOC — and understanding whether it applies to your situation requires knowing the specific requirements, rates, and risks involved.
A securities-backed line of credit (SBLOC) — also called a securities-based line of credit or pledged asset line — is a revolving credit facility where the collateral is your investment portfolio rather than real estate or business assets. You borrow against the value of stocks, bonds, mutual funds, and ETFs held in your non-retirement accounts, without selling them.
The structure works like a home equity line of credit (HELOC), but with your investment portfolio as the asset being pledged. You draw funds as needed, make interest-only monthly payments on amounts drawn, and repay the principal on a schedule you determine. The line of credit remains open and revolving — pay it down and draw again as needed.
One critical restriction, confirmed by FINRA and all major lenders: SBLOC proceeds cannot be used to purchase or trade securities. They are "non-purpose loans" available for virtually any other lawful use — business investment, real estate, tax payments, working capital, acquisitions, or personal expenses.
Minimum portfolio value: typically $100,000. This is the standard minimum confirmed across multiple institutions — including Fidelity, Charles Schwab, and FINRA's investor guidance. Some lenders set higher minimums. Ameris Bank, for example, requires a minimum investment account balance of $143,000 and a minimum credit line of $100,000. Private banks serving high-net-worth clients often set minimums of $250,000 or higher. The specific minimum depends on the institution and the composition of your portfolio.
Eligible collateral — non-retirement accounts only. Tax-advantaged retirement accounts — IRAs, 401(k)s, and similar — cannot be used as collateral for an SBLOC. Assets must be held in taxable brokerage accounts. Eligible securities typically include:
Ineligible assets typically include derivatives, options, penny stocks, illiquid securities, and certain alternative investments. The lender determines eligibility for each specific security in your portfolio.
Credit check: often not required. One of the distinguishing features of SBLOCs is that many lenders do not run a traditional credit check. Your borrowing capacity is determined by the value and composition of your portfolio, not your credit score. This makes SBLOCs accessible to business owners whose credit profiles may be complex — and significantly faster to approve than conventional loans.
Time to approval: typically days, not weeks. Most major institutions can establish an SBLOC and provide access to funds within one week for straightforward applications. Goldman Sachs GS Select describes the process as "generally no more than several days depending on the complexity of the request." Fidelity states funds are generally accessible within a week of approval.
Your maximum borrowing limit is calculated as a percentage of the pledged portfolio's market value — known as the advance rate. The advance rate varies by asset type:
As an example: a $500,000 portfolio consisting primarily of diversified ETFs and investment-grade bonds might support a credit line of $350,000 to $425,000 at typical advance rates. The specific calculation is done by the lender based on your actual holdings.
FINRA confirms the typical range across the industry is 50% to 95% of portfolio value, with the precise rate depending on "the value of your overall holdings and the types of assets in the account."
SBLOC rates in 2026 are variable, tied to the Secured Overnight Financing Rate (SOFR) — the benchmark that replaced LIBOR as the standard reference rate for securities-based lending. SOFR moves daily based on overnight Treasury repo markets and is influenced by Federal Reserve policy.
The all-in rate on an SBLOC has two components:
The resulting all-in rate is generally significantly lower than personal loans, unsecured business lines of credit, or credit cards for equivalent amounts. This rate advantage is the primary financial attraction of SBLOCs for well-capitalised borrowers.
Most SBLOCs have no application fees, origination fees, annual fees, or early repayment penalties — confirmed by Fidelity, Charles Schwab, and Huntington among others. You only pay interest on the amount you have actually drawn, not on the full committed line.
The most significant risk in any SBLOC arrangement is the maintenance call — also called a collateral call or margin call. If the market value of your pledged portfolio declines below the level required to support your outstanding loan balance, the lender can require you to:
FINRA is explicit on this: "If you can't meet the requirements, the firm can sell your securities and keep the cash to satisfy the maintenance call." The timeline for responding to a maintenance call is typically two to three days — not weeks.
This creates a compounding risk during market downturns: your portfolio drops in value, reducing your collateral; the lender issues a maintenance call; if you cannot respond, your securities are sold at depressed prices, locking in losses and potentially triggering the capital gains tax you were trying to avoid in the first place.
FINRA and Charles Schwab both recommend keeping your borrowing well below the maximum credit limit — maintaining what Schwab calls "excess collateral" — to reduce the likelihood of a maintenance call during normal market volatility.
SBLOCs work well when:
SBLOCs are higher risk when:
SBLOCs are available through the brokerage or bank where you hold your investment accounts, or through private banks and wealth management firms. The application process at most major institutions involves: selecting which accounts to pledge as collateral, completing the lender's application (typically short, given no credit underwriting), and waiting for the lender to assess the pledged portfolio and determine your credit limit.
The institutions most commonly offering SBLOCs include Fidelity, Charles Schwab, Goldman Sachs (GS Select), Ameris Bank, Regions Bank, Huntington Private Bank, and most major wire houses and private banks. Terms, minimums, rates, and eligible collateral types vary between institutions.
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Disclaimer: This article is for informational purposes only and does not constitute legal, financial, or investment advice. Securities-based lending involves significant risks including potential loss of your investment portfolio. Always consult a qualified financial advisor before entering into any securities-backed lending arrangement.
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