Schwab Bank: Pledged Asset Line®
Offer your clients a line of credit that can be used for a wide range of financial needs.
The flexibility your clients need.
To help investors tap into the value of their investments and access cash for personal or business needs, without having to sell securities, Schwab Bank offers a Pledged Asset Line® (PAL), a line of credit that allows clients to borrow against non-retirement assets in their portfolio.
Secured by eligible assets held in a separate pledged account maintained by Charles Schwab & Co., Inc., clients can use their line of credit to access the funds they need while maintaining their investing strategy.
How can your clients use a PAL?
Can be used for a wide range of financial needs:
- Bridge funding for a new home
- Home renovation
- New business startup
- Tax payments
- College tuition
- Dream vacation
Benefits:
- Line amounts beginning at $100,000.
- Competitive variable rates, based on the Secured Overnight Financing Rate ("SOFR") plus an interest rate spread.
- Interest charges only on the amount of the line used.
- Line access via checks or wire transfers.
- No set-up fees or prepayment penalty. Brokerage fees and commissions may apply.
- Streamlined digital application process.
- Potential rate discounts with Investor Advantage Pricing.1
To learn more, visit the Introduction to the new Pledged Asset Line section in the Service Guide or call Schwab Bank at 800-497-7470 to speak with a banking professional.
PAL interest rates
Rates below do not reflect Investor Advantage Pricing discounts.
PAL interest rates
| Loan Value of Collateral at Origination | Annual Percentage Rate (APR) |
| $100,000 to <$250,000 | SOFR +4.40% |
| $250,000 to <$500,000 | SOFR +3.90% |
| $500,000 to <$1,000,000 | SOFR +3.40% |
| $1,000,000 to <$2,500,000 | SOFR +2.90% |
| $2,500,000 and above | SOFR +2.40% |
Investor Advantage Pricing1
With our exclusive offer, the more qualifying assets you have with Schwab, the more you can save on your PAL interest rate.
Qualifying assets are based on Schwab brokerage and Schwab Bank combined account balances, including:
- Schwab Brokerage: Account types in which the borrower is an owner, trustee, or custodian with full access & authority
- Schwab Bank: Checking and savings accounts in which the borrower is an owner
- Non-Retirement Business: Corporation, LLC, Partnership, and Sole Proprietorship in which the borrower is the owner with full access & authority. (Excludes Business Retirement such as Simple IRA, SEP IRA & Pension Trust)
- Retirement: Traditional, Roth, Rollover, and Inherited IRAs. (Excludes Educational IRAs and Custodial IRAs)
0.25%
interest rate discount
$250,000 – <$1M
in qualifying assets
0.50%
interest rate discount
$1M – <$5M
in qualifying assets
0.75%
interest rate discount
$5M – <$10M
in qualifying assets
1.00%
interest rate discount
$10M+
in qualifying assets
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Ready to see how our integrated banking, lending, and trust solutions help simplify the support you give your clients?
Learn more in the Service Guide, contact your banking professional, or call 800-497-7470.
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Investment and Insurance Products Are: Not FDIC Insured • Not Insured by Any Federal Government Agency • Not a Deposit or Other Obligation of, or Guaranteed by, the Bank or any of its Affiliates • Subject to Investment Risks, Including Possible Loss of Principal Amount Invested
1. Charles Schwab Bank, SSB Investor Advantage Pricing (IAP): Select mortgage and securities-based loans may qualify for an interest rate discount between 0.25% and 1.00% based on qualifying assets of $250,000 or greater. Discount for Adjustable-Rate Mortgages (ARMs) applies to initial fixed-rate period only. Qualifying assets are based on Schwab brokerage, Charles Schwab Bank, SSB, and Charles Schwab Premier Bank, SSB combined account balances, including select brokerage, bank, cryptocurrency, and retirement accounts. Loans are eligible for only one IAP discount per loan. Securities-based loans to organizational borrowers are not currently eligible for IAP discounts. Schwab Bank reserves the right to amend, terminate or withdraw the rate discount at any time without prior notice. See https://www.schwab.com/IAP for complete details.
The Pledged Asset Line is a demand line of credit provided by Charles Schwab Bank, SSB. As a non-purpose line of credit, proceeds may not be used to purchase securities or spot cryptocurrency, pay down margin loans or any loan used to purchase spot cryptocurrency, or be deposited into any brokerage account.
Entering into a Pledged Asset Line and pledging securities as collateral involves a high degree of risk. You are pledging securities, the value of which is affected by events outside your control. Market fluctuations may cause the value of your pledged assets to decline. In addition, Schwab Bank, in its sole discretion, will determine at any time the eligible collateral criteria and the loan value of collateral. The Pledged Asset Line is uncommitted and Schwab Bank may demand full repayment at any time for any reason or no reason. In addition, if the loan value of collateral is insufficient to satisfy the minimum credit facility size 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 be pledged; otherwise Schwab Bank may immediately sell some or all of the pledged securities without further notice to you, which may result in tax consequences.
A Pledged Asset Line requires a brokerage account (a "Pledged Account") at Charles Schwab & Co., Inc. and sufficient eligible collateral to support a minimum credit facility size of $100,000. Schwab Bank is not acting or registered as securities broker-dealers or investment advisors.
All loans are subject to credit and collateral approval. Before you decide to apply for a Pledged Asset Line, make sure you understand the risks.
The advertised Annual Percentage Rate (APR) is an estimate reflecting the average borrowers cost expressed as a percentage. The APR will be set during underwriting and is based on the loan value of collateral at the time of origination. Your individual rate may vary. The APR is variable and may change weekly based on the current market rate of the Secured Overnight Financing Rate (SOFR).
Charles Schwab & Co., Inc., and Charles Schwab Bank, SSB are separate but affiliated companies and subsidiaries of The Charles Schwab Corporation. Deposit and lending products are offered by Charles Schwab Bank, SSB, Member FDIC and an Equal Housing Lender.