Margin loans could be the sneakiest way to snag a low-interest rate loan in today’s Fed-influenced environment. What most investors don’t know is that you can use your stock portfolio as collateral to get massively discounted lending, but it comes with considerable risk. Carl and Mindy Jensen used this type of lending to buy their most recent real estate purchase, a medium-term rental renovation project in the same neighborhood as their primary residence.

At the time, Carl could get an interest rate so attractive that it was almost impossible to pass up. We’re talking about mortgage-sized loans with less than 2% interest! This seemed like a steal at the time, but as the market started to tank and big tech stocks like Tesla took a tumble, Carl and Mindy’s margin loan began getting hit. They faced a tough decision: either get liquidated and lose much of their stock portfolio or come up with the difference themselves.

In this episode, you’ll hear exactly how Carl and Mindy grew their stock portfolio to multiple millions in worth, the mistakes they made along the way, why they took out a margin loan, and whether or not they’d do it again. If you’ve got a sizable stock portfolio but don’t know how to get funding for your real estate deal, stick around! Margin loans could be an option for you, but you’ll need to know how to work them first.

00:00 Intro
02:28 Tech Stocks, Tesla, and Crazy Returns
08:23 Beating the Index Funds!
10:28 Buying a House and Risky Borrowing
17:59 Too Much of a Good Thing?
25:19 Are Margin Loans Ever Worth It?
30:43 Plans for the Property
34:00 Margin Loan Monkey Business

Show Notes at:
https://www.biggerpockets.com/blog/money-376?utm_source=youtube&utm_medium=description&utm_campaign=none
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Hear Carl and Mindy’s Last Episode on Margin Loans:
https://www.biggerpockets.com/blog/money-350?utm_source=youtube&utm_medium=description&utm_campaign=none
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Hear Our Interview with Tony Robinson from the “Real Estate Rookie” Podcast:
https://www.biggerpockets.com/blog/biggerpockets-money-podcast-151-tony-robinson?utm_source=youtube&utm_medium=description&utm_campaign=none
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Nerd Out Over Tesla Stock!
https://youtu.be/Z6sVutg9Z3g
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Hear More from Carl:
The “Mile High FI” Podcast: https://milehighfi.com/
1,500 Days to Freedom: https://www.1500days.com/
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Connect with Carl, Scott, and Mindy on BiggerPockets:
Carl: https://www.biggerpockets.com/users/carljensen?utm_source=youtube&utm_medium=description&utm_campaign=none
Scott: https://www.biggerpockets.com/users/scotttrench?utm_source=youtube&utm_medium=description&utm_campaign=none
Mindy: https://www.biggerpockets.com/users/mindyjensen?utm_source=youtube&utm_medium=description&utm_campaign=none

Episode 376

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