Pledged Asset Loans in San Diego: Buy a Home Without Selling Your Investments
A pledged asset loan lets you use your stocks, bonds, or managed investment portfolio as collateral for a mortgage instead of selling those investments to make a down payment. Your portfolio stays invested and under your advisor's management, which can help you avoid triggering capital gains from a sale. Mission Pacific Mortgage structures pledged asset loans for high-net-worth buyers across San Diego County and California.
Why Consider This Option?
Maintain eligible investments without selling to fund the purchase.
Continue working with your financial advisor.
Eligible securities may replace some or all of your cash down payment.
Avoid realizing capital gains solely to fund a down payment.
Is a Pledged Asset Loan Right for You?
This option may make sense if you have significant investments and want to buy a home without disrupting your long-term financial plans.
Investment Portfolio Owners
You have significant investments and would rather keep them invested than sell them for a home purchase.
Buyers With Capital Gains
Selling investments could create a large capital gains tax bill.
Executives & Business Owners
Your wealth may be concentrated in an investment portfolio rather than available cash.
Clients With Financial Advisors
You want to maintain your existing advisor relationship and keep assets under management.
Qualified Homebuyers
You qualify based on income but prefer to use less cash for a down payment without paying mortgage insurance.
Long-Term Investors
You want to purchase a home while keeping your investment strategy in place.
How a Pledged Asset Loan Works
Instead of selling investments to make a down payment, eligible assets can be pledged as additional collateral for your mortgage.
Pledge Eligible Assets
Eligible securities are placed in a pledged account at your custodian. You still own them, while the lender holds a lien on the account.
Keep Your Portfolio Invested
Your investments remain in the account. You can generally continue trading within the custodian's guidelines and receive dividends and growth.
Reduce Your Cash Down Payment
The pledged securities may reduce or replace the cash down payment, depending on the loan structure.
Coordinate Your Financial Plan
Robert works with your financial advisor and custodian before assets move so the structure fits your broader wealth strategy.
What You'll Need to Get Started
Getting started is straightforward. We'll review your portfolio, financial information, and potential loan structure.
There is no set minimum portfolio size. As a general guideline, the amount you can pledge is limited to about 50% of your portfolio's value.
The actual amount depends on your investments, the custodian, and the lender's requirements.
General guideline for the portion of your portfolio's value that may be eligible as pledged collateral.
Example: A $500,000 pledge may require a portfolio worth around $1 million or more.
Documents to Prepare
- ✓ Recent brokerage account statements
- ✓ Standard income documentation
- ✓ Standard asset documentation
- ✓ Financial advisor's contact information, if you'd like them involved
✓ Generally Eligible Assets
- Publicly traded stocks
- Exchange-traded funds (ETFs)
- Mutual funds
- Bonds and U.S. Treasuries
- Cash in eligible accounts
- Eligible individual, joint, and revocable trust accounts
× Assets That Cannot Be Pledged
- Individual Retirement Accounts (IRAs)
- 401(k) retirement accounts
- Annuities
- Restricted or control stock
- Options
Eligibility is determined by the custodian and lender. Retirement accounts cannot be pledged under this structure. IRS rules treat the pledging of an IRA as a taxable distribution. Certain entity-owned accounts may require additional review.
Portfolio Preserved. AUM Retained.
See how a pledged asset loan helped preserve an investment portfolio and avoid an estimated capital gains tax cost.
Read the Full Case Study →Pledged Asset Loan FAQs
Answers to common questions about using investments as collateral for a home purchase.
Do I give up control of my investments?
No. The securities stay in your name and under your advisor's management in a pledged account at your custodian. You keep dividends and growth. The lender holds a lien, not ownership, although collateral restrictions still apply.
What happens if the market drops?
A significant decline in your portfolio's value may require additional collateral or a partial loan repayment. Robert reviews this risk with you before you proceed.
Can I still trade in my pledged account?
Generally, yes. Trading is subject to your custodian's guidelines for pledged accounts, including any required collateral levels.
Is this the same as a margin loan?
No. A pledged asset mortgage is a home loan secured by the property and pledged investments. A margin loan or securities-based line of credit is a separate form of borrowing against your portfolio.
How large does my portfolio need to be?
There is no set minimum portfolio size. Lenders typically allow pledging up to about half the portfolio's value. For example, a $500,000 pledge may require around $1 million in eligible investments or more.
Can I pledge my IRA or 401(k)?
No. Retirement accounts cannot be pledged under this structure. The IRS treats pledging an IRA as a taxable distribution. An asset depletion loan may be a better alternative when most of your wealth is held in retirement accounts.
Can the investment account be held in my trust?
Usually, yes, when held in a revocable living trust. Accounts owned by an LLC, partnership, or corporation may also qualify with additional documentation and review.
Are pledged asset loans available in San Diego?
Yes. Mission Pacific Mortgage is based in Carlsbad and serves borrowers throughout San Diego County and California.
Explore Your Home Financing Options
Find out whether your investment portfolio can help you purchase a home without selling assets. Robert can review your options and coordinate with your financial advisor.
Discuss Your Options →Important Disclosure: Pledged asset structures carry risk. The pledged securities secure the loan; a decline in portfolio value may require additional collateral or repayment, and the lender may liquidate pledged assets to satisfy a shortfall. Availability and terms depend on the custodian, portfolio, and borrower-specific facts. This information is not tax advice. Consult a CPA.
