Portfolio line of credit
Turn investments into credit instantly, with rates as low as 3.95%
$1 in assets
4.95%
Core rate
$100,000 in assets
4.45%
Premium rate
$500,000 in assets
3.95%
Generation rate
Get credit in minutes
No impact on your credit score. No approvals. No lengthy applications. That’s the advantage of borrowing against your investments.
Borrow up to 35% of your assets
Have $150,000 in your portfolio? You could borrow up to $52,500. Link an account, set your collateral, and pay it back on your own time.
Access cash in an instant
Breathe easy: It’s a low-risk, reliable way to access money. And you can move it to a chequing or investing account in seconds.
A smarter way to borrow
This ain't your average loan. Because a portfolio line of credit is secured by your investments — which are usually your most liquid assets — we're taking on less risk, meaning we can offer way lower rates. Win-win.
Wealthsimple portfolio line of credit | Unsecured line of credit | Credit card | |
|---|---|---|---|
| Interest rate | 3.95%–4.95% | It's a big, up-to-10% secret | Up to 22.99% |
| Annual interest on $25,000 | As low as $987.50 | Up to $2,500 | Up to $5,747.50 |
| Access to funds | Seconds | Depends on when you can go to a branch | Up to a few days |
| Credit check required | No | Yes | Yes |
| Borrowing limit | Grows with your portfolio | Up to $200,000 | You'll know after a credit check |
| Fees | $0 | $0 | Up to $599 per year |
Ways to use your portfolio line of credit
- Consolidate your debt to pay less interest — perfect if you have credit cards with rotating interest, or pay fees higher than 20%
- Repay your debt in one, low-interest place
- Pay your debt while keeping your investments growing
- Top up your RRSP to reduce your taxable income
- Maximize your time in market
- Invest using your TFSA for tax-free growth
- Move cash into an investing account immediately
- Borrow against as little as $1,000 for an emergency, the car you need, or the cardigan you don’t
- The higher your assets’ value, the higher your credit limit
- Move cash into a chequing account immediately
- Only pay interest on what you’ve borrowed
Break up with your bank
Open a portfolio line of credit instantly. Pay it back on your own time.
FAQs
What’s a portfolio line of credit?
What’s a portfolio line of credit?
The portfolio line of credit is a separate margin account that allows you to borrow cash using your investments as collateral. This lets you access funds without selling your assets, so your investments can stay invested for long-term growth.
When you open a portfolio line of credit, you choose which investment accounts to use as collateral. The amount you can borrow — your credit limit — is based on the value of the assets in those accounts. You can borrow up to your limit at any time, and you only pay interest on the amount borrowed.
Which accounts can I use as collateral?
Which accounts can I use as collateral?
When you open your account, you choose which investment accounts to borrow against. You can pick from your self-directed or managed investment accounts, with the exception of:
- FHSAs, RRSPs, RESPs, or LIRAs
- Joint accounts
Additionally, you can't link an account that's already linked to a margin account. Or any margin account, period. Because using one margin account as collateral for another one is like getting new credit on existing credit, and margin Inception isn’t a thing.
Is there a minimum collateral?
Is there a minimum collateral?
To be eligible to be used as collateral, the account must provide a minimum collateral value of $1,000 CAD. This value is calculated by several factors based on the value of your assets in the account.
What are the interest rates, and how is interest charged?
What are the interest rates, and how is interest charged?
The interest rates of the portfolio line of credit are:
- Core — CAD prime +0.5%
- Premium — CAD prime +0%
- Generation — CAD prime -0%
When borrowing money using your portfolio line of credit, you’ll be charged an interest rate based on the current CAD prime, as well as your client status. Interest is accrued daily and deducted from your portfolio line of credit on a monthly basis.
How do you calculate my credit limit?
How do you calculate my credit limit?
The portfolio line of credit generally offers conservative credit limits, and that’s by design. Markets go through swings that can impact your assets — it’s normal stuff! — and we don’t want your portfolio to drop below the minimum required collateral to secure your borrowing. Bottom line: We want to keep your portfolio and your line of credit intact.
Your credit limit is calculated daily based on the assets in your collateral accounts. There are several factors that contribute to your credit limit, including the type and value of assets in your collateral accounts. Broadly, you can borrow up to 35% of your portfolio.
You can view how much each collateral account contributes to your credit limit in the settings after opening an account.
What happens if I reach my credit limit?
What happens if I reach my credit limit?
If you borrow the maximum amount available, or if the value of the assets in your collateral accounts drop to equal your loan balance, you may reach your credit limit.
If this happens, the following restrictions apply:
- You can't borrow any more money with your portfolio line of credit
- You can't withdraw or transfer money or holdings out of a collateral account
- You can't buy more assets with any cash in your collateral accounts
To remove these restrictions, you need to pay back some of your loan balance, increase your collateral, or both.
How is a portfolio line of credit different than a garden-variety line of credit?
How is a portfolio line of credit different than a garden-variety line of credit?
A portfolio line of credit uses your investments as collateral allowing you to borrow without selling assets, while a personal line of credit is unsecured and based solely on your creditworthiness.
Also, how is a portfolio line of credit different than borrowing from a margin account?
Also, how is a portfolio line of credit different than borrowing from a margin account?
Your portfolio line of credit is a margin loan, but with a more conservative limit. To get more specific:
- Your credit limit is more conservative, so there's a bigger buffer to protect you if your investment collateral loses value.
- People typically use their portfolio line of credit to withdraw cash for everyday needs, not to buy more investments. This means losses aren't as magnified.
Learn more about borrowing from your margin account.