What’s the difference between Margin loan and Security-back line of credit

Margin loan

A margin loan is a loan that you take against your investment. The loan require you to pay the monthly interest only. The loan interest is not fixed, it’s variable, so it can change at any time.

You can use this margin loan to buy the same investment again or any investment or you can use the loan for anything else outside the investments.

On the other hand,

Security-back line of credit

Security-back line of credit is a loan that you take against your investment. The loan require you to pay the monthly interest only. The loan interest is not fixed, it’s variable, so it can change at any time.

The difference

You cannot use Security-back line of credit to buy the same investment again such as stocks, bonds, mutual funds or index funds.

You can use security-back line of credit to buy real estate or to buy liabilities.