Here's what you get

  • A principal & interest investment loan for managed investments

  • A flexible loan term from 3 – 10 years

  • Monthly repayments with early pay off possible

  • A variable interest rate and no ongoing fees

  • 2% special rate discount for the life of the loan

Eligibility

  • The loan is for investment or business purposes only

  • You need to be 18+ and a permanent Australian resident

  • You need to understand there are risks involved when investing in the share market

What is NAB Equity Builder?

NAB Equity Builder is a principal and interest (P&I) investment loan that lets you borrow money to acquire financial assets such as:

  • managed funds
  • exchange traded funds (ETFs)
  • listed investment companies (LICs)
  • separately managed accounts (SMAs).

Borrowing to invest is a popular strategy for building wealth in Australia, it's usually applied to property.

We’re the only bank with a principal and interest lending solution that lets you borrow to invest in financial assets, without using your property as security. So you can rest easy knowing you’re not borrowing against your house. Instead, the managed investments you acquire through the NAB Equity Builder loan will be held as security.

NAB Equity Builder – an alternative way to invest

Find out how borrowing to invest in managed investments could help you achieve your financial goals | View transcript (TXT, 6KB)

  • It's another way to build wealth.
  • It amplifies your investing potential and your exposure to domestic and international opportunities.
  • The minimum loan amount is $10k and can be increased at anytime.
  • It enables a disciplined savings approach for investment goals – no margin calls, just regular P&I repayments.
  • There's a broad choice of 950+ diversified investments.
  • You own an investment portfolio of financial assets that can grow in value over time.
  • Once you’ve paid off your loan, you can keep your asset as an additional income stream, reinvest or sell all or part of your investments and use the money towards the things that matter to you.

Rates

5.90% Standard Variable rate

3.90% Special rate

The special rate is a 2% discount off the standard variable rate. The discount will apply for the life of the loan or until varied or withdrawn by NAB.

How to get started

Get started with your new NAB Equity Builder Loan

Apply now

Still have questions?

What is a principal and interest investment loan?

It’s an investment loan where each payment reduces the principal (the amount you initially borrowed) as well as covering the interest. Once you pay off the loan in full, the assets are 100% yours.

How does NAB Equity Builder work?

NAB Equity Builder is just like a home loan, but for financial assets instead of property.

Once approved, you can choose from over 950+ approved investments. You can opt to:

  • acquire investments all at once
  • wait for the right opportunity
  • break it up into a number of smaller investments over time.

When you (or your adviser) have decided on your investments, we’ll purchase the investments on your behalf. As it’s a principal and interest loan, all you need to do is meet the monthly repayments over a set period of time. Once your loan is paid in full, the financial assets are all yours.

How is it different to a traditional margin loan?

Traditional margin loans also allow you to borrow to invest for any business or investment purpose, with the shares held as the loan security.

As share prices can fluctuate, there’s a risk that the shares might fall in value. If the value of your investments falls to a point where your loan exceeds the maximum loan value ratio (LVR), you’ll receive a margin call. This could involve:

  • making a lump sum payment
  • selling part of your investment
  • providing extra security (e.g. security over other shares).

If you do not take one of the required actions, the lender can sell your shares to meet the margin call.

With NAB Equity Builder, the loan is set up as principal and interest. This means you have a disciplined repayment plan built in. It’s a lending solution with no margin calls, making things easier on both your budget and your peace of mind. This loan type allows you to stick to your plan, without short term market volatility impacting on your long term investment goals.

Should you borrow to buy shares?

More specifically, should you borrow to invest in managed investments? If you’re comfortable with borrowing money to invest in financial assets, then NAB Equity Builder could allow you to contribute a larger amount on day one. If your investments perform well the effect of compound returns is much stronger, which could lead to better investment results in the long term.

However, investors who borrow should be comfortable with the risk they’re taking. It’s important to understand that gearing magnifies both the potential for gains and losses in assets, which can both increase and decrease in value. Even with the repayment of your principal over the loan term, losses will be magnified in the event of a market downturn, or asset devaluations.

More information on NAB Equity Builder

NAB Equity Builder, opens in a new window

Innovation Award for Equity Builder loan product

In the media, opens in a new window

Noel Whittaker gives thumbs up to NAB Equity Builder

Podcast: Saving for the kids education, opens in a new window

Saving vs investing and whether borrowing can help

ETFs 101, opens in a new window

A basic introduction about Exchange Traded Funds (ETFs)

Borrowing to invest webinar, opens in a new window

What to consider when investing in property and equity loans

Basics of the Australian Stock Market, opens in a new window

Get an overview on how the stock market works

Important information

The information provided on this web page is intended to be of a general nature only. Any advice on this page has been prepared without taking into account your objectives, financial situation or needs. Before acting on any advice on this page, National Australia Bank Limited (ABN 12 004 044 937 AFSL 230686) (NAB) recommends you consider whether it is appropriate for your objectives, financial situation and needs. NAB recommends that you seek independent advice before acting on any information on this web page. The taxation information contained on this website is of a general nature. The tax consequences of investing will depend on your particular circumstances. We recommend that you seek professional tax advice before applying for a NAB Equity Builder facility.

Just like with any investment decision you make, you need to consider the risks. It’s important to know that investing in the share market (domestically and overseas) carries risk and requires a long term focus, as many variables can cause short term fluctuations; both down and up. Borrowing to invest can be an effective wealth building strategy, but gearing does introduce another level of risk. It magnifies the impact on your equity of increases and decreases in your portfolio. Also interest rates can rise over time, which increases the cost of implementing the strategy.

This web page is not a substitute for reading the NAB Equity Builder Facility Terms and Product Brochure. NAB is the issuer of NAB Equity Builder and recommends you consider the Facility Terms before making any decisions.

©2020 National Australia Bank Limited ABN 12 004 044 937 AFSL and Australian Credit Licence

^The special rate for variable loans applies to new NAB Equity Builder facilities from 1 May 2020. The discount will apply for the life of the loan, or until varied or withdrawn by NAB. For NAB Choice Package, NAB Private Package or Portfolio Package clients, this is the maximum discount available when applied in conjunction with any other offer.

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