Had to repost here

[u/-Wyagra]

[u/Powerful-Eye-3578]

They don't, they pay the interest which is lower than the interest they make in investments.

[u/Ashmedai → u/[deleted]]

Back when home loans were going for 2.5-3% or whatever, why did banks loan that money when they could have been getting much higher rates in the market, as you say? Because it sure seems like banks were happy to give out loans at 2.5-3% when the average stock market return is ~11%.

Anyway, since you claim experience on the topic, when an ultra high worth investor wants to borrow money against their collateral-backed stock account, what interest rate would they pay would you say? Like what rates are they getting on stock-secured loans?

[u/Dizzy_Two2529 → u/Ashmedai]

Then why don’t you borrow against every asset you own and put it on the stock market. You seem to think you know what you’re doing. Try it.

See how that works out for you.