M1 Borrow billing


How do you calculate the interest?

When you use M1 Borrow, interest will accumulate for each day that you use your portfolio line of credit.


How am I billed?

Your bill will be available at the end of each month, and you will only need to pay for the line of credit borrowed.


When will I be charged?

You will be charged on the due date of your bill before the daily trade window. Here’s the order in which we automate interest repayment:

1. Cash balance: We always pull from the cash you keep in your account first if there is cash available.

2. Borrow additional funds: If your cash balance is insufficient and you have not maxed out your available credit, we will borrow more to cover the cost of your interest. We do this so you avoid having to sell securities from your portfolio and avoid taxable events. This also helps keep your loan on your schedule so you can repay it when it’s most convenient for you.

3. Sell securities: This is our last resort for interest repayment. If options 1 and 2 are not available, we will sell securities to cover the cost.


Loan repayment

Traditional loans use an amortization schedule that includes a percentage of principal and interest.

With M1 Borrow, repayment of principal and interest are independent of one another.



A benefit of M1 Borrow is the flexible repayment schedule. We don’t require a minimum monthly loan repayment.

You can pay back any principal amount at any time.

Recurring deposits that are scheduled into your M1 Invest account will not repay your outstanding loan.

However, you can create a payback schedule by selecting: “Transfers” > “Move Money” > “Recurring Transfer” > input “Borrow” as the "To" account.

M1 Finance account screen showing credit limit on Borrow tab

How is the Borrow rate calculated?

The M1 Borrow rate is based on short-term interest rates and is subject to change if and when the Federal Reserve changes its target for the federal funds rate.

The M1 Plus membership includes a reduction on the M1 Borrow base rate. This reduction is effective immediately upon M1 Plus sign-up and will be reflected on the Borrow bill. You can learn more about M1 Plus here.



Using margin involves risks: you can lose more than you deposit, you are subject to a margin call, and interest rates may change. To learn more about the risks associated with margin loans, please see our Margin Disclosure. M1 Borrow available on margin accounts with a balance of at least $5,000. This does not apply to retirement accounts.


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