Skip To Content
Lines of Credit

Margin Lending Program

The Margin Lending Program (margin) provides an extension of credit based on eligible securities used as collateral from your qualified Merrill accounts. Margin offers a source of liquidity with competitive rates that allows for timely market investments, diversification, stock option financing or short selling.

A good choice if you:

  • Don’t want to sell assets or deplete cash reserves to fund your investment goals
  • Want access to funds with no set term, no set limits, no minimum loan amount and no application or annual fee.
  • Take advantage of pricing based on your overall relationship
  • Continue to trade and manage investments you use as collateral, subject to certain restrictions.


  • Margin loans are used to cover transactions in a margin account when there isn’t sufficient cash and money account balances for the transaction. This can happen for a securities trade, through check writing or Visa debit card purchases, or Bill Pay transactions
  • Borrow with floating interest rates, based upon the Merrill Base Lending Rate (plus a spread), total relationship size, and amount borrowed.
  • No set repayment schedule if you maintain the required level of equity in your account.
  • No interest payments required, interest will be added to your balance at the end of each month, provided sufficient credit is available.

Potentially save on interest expenses related to your Margin account

Interest expenses associated with your Margin borrowing may be tax-deductible, up to net investment income earned in the account. Margin interest expenses may also be exempt from the Alternative Minimum Tax (AMT).  Merrill does not provide tax advice, so please consult your tax advisor for tax advice about margin interest deductibility.


Let’s start a conversation

Talk to your Merrill advisor to see if Margin can help you tap into the value of your investments and support your larger financial strategy.


Risks associated with margin 

Margin is not appropriate for all investors. Borrowing on margin and using securities as collateral involve certain risks. When considering a margin loan, you should take into account your individual requirements, portfolio composition and risk tolerance, as well as capital gains taxes, portfolio performance expectations and investment time horizon. Please be aware that:


  • When you purchase securities, you may pay for the securities in full, or if your account has been established as a margin account with the Margin Lending Program, you may borrow part of the purchase price from Merrill, thereby leveraging your investment.
  • If you choose to borrow funds for your purchase, Merrill’s collateral for the loan will be the securities purchased, other assets in your margin account, and your assets in any other accounts at Merrill other than retirement accounts (such as IRAs).
  • If the securities in your margin account decline in value, so does the value of the collateral supporting your loan, and, as a result, we can take action, such as to issue a margin call and/or sell securities in any of your accounts held with us, in order to maintain the required equity in your account.
  • If your account has a Visa® card and/or checks, you may also create a margin debit if your withdrawals (by Visa card, checks, preauthorized debits, funds transfer service (FTS) or other transfers) exceed the sum of any available free credit balances plus available money account balances (such as bank deposit balances or money market funds). Please refer to your account documents for more information.
  • Also note that it may be more advantageous to pay cash than to use margin for smaller securities purchases. On smaller securities purchases, a higher percentage of the transaction costs goes to commissions and interest charges, which are generally higher on smaller balances. The commissions plus interest charges could equal or exceed any appreciation in your securities.


Before opening a margin account, you should carefully review the terms governing margin loans. For Individual Investor Accounts, these terms are contained in the Margin Lending Program Client Agreement. For all other accounts, the terms are in your account agreement and disclosures. It is important that you fully understand the risks involved in using margin. These risks include the following:


  • You can lose more funds than you deposit in the margin account. A decline in the value of securities that are purchased on margin may require you to provide additional funds to use to avoid the forced sale of those securities or other securities or assets in your account(s).
  • We can force the sale of securities or other assets in your account(s). If the equity in your account falls below the maintenance margin requirements or Merrill’s higher “house” requirements, we can sell the securities or other assets in any of your accounts held by us to cover the margin deficiency. You also will be responsible for any shortfall in the account after such a sale.
  • We can sell your securities or other assets without contacting you. Some investors mistakenly believe that they must be contacted for a margin call to be valid, and that securities or other assets in their accounts cannot be liquidated to meet the call unless they are contacted first. This is not the case. We will attempt to notify you of margin calls, but we are not required to do so. Even if we have contacted you and provided a specific date by which you can meet a margin call, we can still take necessary steps to protect our financial interests, including immediately selling the securities or other assets without notice to you.
  • You are not entitled to choose which securities or other assets in your account(s) are liquidated or sold to meet a margin call. Because the securities or other assets are collateral for the margin loan, we have the right to decide which securities or other assets to sell in order to protect our interests.
  • We can increase our “house” maintenance margin requirements at any time and are not required to provide you advance written notice. These changes in our policy may take effect immediately and may result in the issuance of a maintenance margin call. Your failure to satisfy the call may cause us to liquidate or sell securities in your account(s).
  • You are not entitled to an extension of time on a margin call. While an extension of time to meet margin requirements may be available to you under certain conditions, you do not have a right to the extension.


Strategies for managing margin risks

Carefully choosing the quality of your investments you borrow against and the amount you borrow can help reduce the likelihood of a maintenance call. Risk management strategies to consider include:


  • Borrowing against a portfolio of less-volatile securities, such as government bonds or blue-chip stocks.
  • Borrowing less than the maximum amount allowable against your securities.
  • Diversifying your portfolio by purchasing securities that balance your holdings and potentially offset losses on existing securities.
  • Monitoring your portfolio, especially during fluctuating, volatile market conditions, to anticipate a potential decline in value.


Find a financial advisor


Explore our other solutions

Wheel diagram showing solution categories that include Manage my personal finances, Borrow to fund my goals, Help grow my wealth, Save for the future, Protect my wealth, and Plan the impact of my wealth

Whether you’re defining goals, addressing change or figuring out how to move forward, Merrill and Bank of America offer a wide range of solutions to help you take the next step and stay on track.

Find the right advisor for you

Our financial advisors are committed to putting your investing needs and priorities first. Here’s how you can get started with an advisor:


Ready to start looking?

Want us to contact you?


Diversification does not ensure a profit or protect against loss in declining markets.



You need to answer some questions first

Then we can provide you with relevant answers.

Get started