Three ways Charles Schwab Bank can enhance your tax planning conversations

Schwab Bank products make it easy to identify strategic lending and savings opportunities.

You want to help clients achieve their goals, be that investing in a business, paying a large tax bill, buying a new home, paying for a child's education, or retiring early. In these discussions, it's critical to discuss the role of credit in determining clients' overall financial needs. With offers from Schwab Bank, you can identify strategic lending and savings opportunities that can help clients achieve their goals while also helping to protect against disruptions to their overall investment strategy.

Learn more about:

  1. Using Pledged Asset Lines for greater flexibility when borrowing
  2. Mortgage discounts and other benefits for Schwab Bank clients
  3. Dedicated support when clients need it

Using a Pledged Asset Line® (PAL) for greater flexibility when borrowing

PAL is a non-purpose*, securities-based line of credit that allows your clients to leverage the value of eligible assets in their investment portfolio as collateral for a secured loan. During this time of year, when many clients worry about the possibility of an unexpected tax bill, a PAL can offer increased borrowing flexibility with advance rates based on security type. When using a PAL, keep in mind that available credit will adjust based on the real-time value of eligible pledged brokerage assets.

A Pledged Asset Line can be beneficial to your clients for a variety of reasons.

  • Cost: PALs incur no origination fee. No maintenance fee. No annual fees. No prepayment penalties. No early closure fee. No wire or check fees. In the case of late payments, clients may be assessed a $25 fee.
  • Flexibility: PALs can be accessed multiple ways including wire transfers, checks and online transfers.
  • Control†: Clients can determine when they borrow, how much they borrow, and how they repay the debt.

In addition to helping with tax liabilities, there are many other ways clients may be able to use a PAL.

  • Student loan financing
  • Residential construction loan
  • Bridge financing
  • Rental property loan
  • Business start-up loan
  • Large purchase
  • Commercial real estate
  • Business buy out
  • Marine and aviation financing
  • Fine art financing
  • Livestock and land purchase
  • Estate loan

Visit the Introduction to the Pledged Asset Line (Demand) in the Service Guide to learn more.

Entering into a Pledged Asset Line and pledging securities as collateral involve a high degree of risk. Before deciding to apply for a Pledged Asset Line, your clients should be sure they understand the risks.

Please know that Schwab Bank requires that the assets pledged as collateral for the Pledged Asset Line be held in a separate Pledged Account maintained at Charles Schwab & Co., Inc. (Schwab). Schwab Bank, in its sole discretion, will determine at any time the eligible collateral criteria and the loan value of collateral.

*A non-purpose line of credit may not be used to purchase securities, pay down margin loans, or be deposited into any brokerage account. Proceeds must be used for a lawful personal, commercial, or business purpose under state, federal, or other applicable law.

†The initial advance must be at least $70,000. Subsequent advances may be less once that requirement is met. Loans are subject to available credit. Mandatory interest payments are due monthly. All or any part of the PAL obligations are payable immediately upon demand by Schwab Bank in its sole discretion.

Mortgage discounts and other benefits for Schwab Bank clients

Schwab Bank's Investor Advantage Pricing means clients have access to discounts on mortgage rates for eligible home loan products, including all adjustable-rate mortgages (ARM) and select fixed rate jumbo loans. Eligible clients may take advantage of interest rate discounts ranging from 0.250% to 1.000% on both purchase and refinance mortgage loans based on their qualifying assets with Schwab and Schwab Bank. Schwab Bank home loans are provided by Rocket Mortgage®.

Visit the  section in the Service Guide to learn more.

In order to participate, the borrower must agree that the lender, Rocket Mortgage, may share their information with Charles Schwab Bank and Charles Schwab Bank will share their information with the lender Rocket Mortgage. Nothing herein is or should be interpreted as an obligation to lend. Loans are subject to credit and collateral approval. Other conditions and restrictions may apply. This offer is subject to change or withdraw at any time and without notice. Interest rate discounts cannot be combined with any other offers or rate discounts. Hazard insurance may be required.

Dedicated support when clients need it

Schwab Bank provides support in a variety of ways, from Regional Banking Managers to Senior Bankers dedicated to supporting specific advisors, to help you meet your clients' banking needs from the most mundane to the very complex. With a focus on advisors and their clients, Schwab Bank offers high-touch service and access to solutions that can help advisors enhance their wealth management offering.

Related resources

To learn more, visit the following sections in the Service Guide:

(1022-28V0)

Brokerage Products: Not FDIC Insured • No Bank Guarantee  •  May Lose Value

This offer is subject to change or withdrawal at any time and without notice. Nothing herein is or should be interpreted as an obligation to lend. Loans are subject to credit and collateral approval. Other conditions and restrictions may apply. Hazard insurance may be required.

For Schwab Bank Pledged Asset Line: At any time, including in the event that the loan value of collateral is insufficient to satisfy the minimum loan value of collateral or to support the outstanding loans, Schwab Bank may demand immediate payment of all or any portion of the outstanding obligations, or require additional cash or securities to be added to the Pledged Account maintained at Charles Schwab & Co., Inc. If a Demand is not addressed, the pledged securities may be immediately liquidated without further notice, which may result in tax consequences.

For Schwab Bank Investor Advantage Pricing (IAP): Loans are eligible for only one Investor Advantage Pricing discount per loan. Select mortgage loans are eligible for an interest rate discount of 0.250% - 1.000% based on qualifying assets of $250,000 or greater. Discount applies to ARMs, Jumbo 15-yr and Jumbo 30-yr fixed (excludes HELOCs, VA loans, and FHA loans). Discount for ARMs applies to initial fixed-rate period only. 

Qualifying assets are based on non-retirement Schwab brokerage and Schwab Bank combined account balances, including:  

  1. Brokerage accounts in which the borrower(s) is an owner, trustee or custodian; 
  2. Bank accounts in which the borrower(s) is an owner or trustee: checking & savings; 
  3. Business Corporation, LLC, Partnership and Sole Proprietorship accounts may be eligible depending on the borrower's ownership and role.

Retirement accounts, including all IRAs, are excluded from this offer. Schwab Bank makes its best effort to identify all qualifying assets based on your Social Security Number. If you have questions regarding your specific assets or account eligibility, please call your Schwab Bank representative for assistance.

Clients must notify Schwab and Rocket Mortgage of any new assets brought to firm during processing. Qualifying new assets should be deposited and verified 15 days prior to the anticipated closing date to avoid closing delays. If the qualifying assets are deposited with less than 15 days remaining before closing, the closing date may be delayed, and eligibility to receive the interest rate discount may be affected.

Charles Schwab & Co., Inc. and Charles Schwab Bank, SSB are separate but affiliated companies and subsidiaries of The Charles Schwab Corporation. Schwab Advisor ServicesTM serves independent investment advisors and includes the custody, trading, and support services of Schwab. Brokerage products, including the Pledged (Asset) Account, are offered by Charles Schwab & Co., Inc., Member SIPC, and are not insured by the FDIC, are not deposits or obligations of Charles Schwab Bank, SSB and are subject to investment risk, including the possible loss of principal invested. Deposit and lending products, including the Pledged Asset Line, are offered by Charles Schwab Bank, SSB, Member FDIC. Charles Schwab Bank, SSB is not acting or registered as a securities broker-dealer or investment advisor. Home lending is offered and provided by Rocket Mortgage, LLC. Rocket Mortgage LLC., is not affiliated with The Charles Schwab Corporation, Charles Schwab & Co., Inc. or Charles Schwab Bank, SSB. Deposit and other lending products are offered by Charles Schwab Bank, SSB, Member FDIC and Equal Housing Lender.

Rocket Mortgage, LLC; NMLS #3030; www.nmlsconsumeraccess.org. Equal Housing Lender. Licensed in 50 states. AL License No. MC 20979, Control No. 100152352. AR, TX: 1050 Woodward Ave., Detroit, MI 48226-1906, (888) 474-0404; AZ: 1 N. Central Ave., Ste. 2000, Phoenix, AZ 85004, Mortgage Banker License #BK-0902939; CA: Licensed by Dept. of Business Oversight, under the CA Residential Mortgage Lending Act and Finance Lenders Law; CO: Regulated by the Division of Real Estate; GA: Residential Mortgage Licensee #11704; IL: Residential Mortgage Licensee #4127 – Dept. of Financial and Professional Regulation; KS: Licensed Mortgage Company MC.0025309; MA: Mortgage Lender License #ML 3030; ME: Supervised Lender License; MN: Not an offer for a rate lock agreement; MS: Licensed by the MS Dept. of Banking and Consumer Finance; NH: Licensed by the NH Banking Dept., #6743MB; NV: License #626; NJ: New Jersey – Rocket Mortgage, LLC, 1050 Woodward Ave., Detroit, MI 48226, (888) 474-0404, Licensed by the N.J. Department of Banking and Insurance.; NY: Licensed Mortgage Banker – NYS Banking Dept.; OH: MB 850076; OR: License #ML-1387; PA: Licensed by the Dept. of Banking – License #21430; RI: Licensed Lender; WA: Consumer Loan Company License CL-3030. Conditions may apply.

©2022 Charles Schwab Bank, SSB. All rights Reserved. Member FDIC. Equal Housing Lender. 

Equal Housing Lender

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The above mentioned firms and their employees are not affiliated with or employees of Schwab unless otherwise noted. They should not be construed as a recommendation, endorsement of, or sponsorship by Schwab. The views expressed are those of the third party and are provided for information purposes only. Experiences expressed are no guarantee of future performance or success and may not be representative of you or your experience. 

Schwab does not provide investment planning, legal, regulatory, tax, or compliance advice. Consult professionals in these fields to address your specific circumstances.

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Information included on this site is intended to be an overview and is subject to change. Experiences expressed by advisors may not be representative of the experience of other advisors and are not a guarantee of future success.

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