Should you liquidate $500K to buy your home?
Or borrow against it?
See the real cost of all three options. Tax implications included.
Calculate Your Options →Stockstead calculator
Models three financing paths for a high-net-worth home purchase: paying cash, a traditional jumbo mortgage, and a Securities-Backed Line of Credit (SBLOC). Accounts for federal long-term capital gains, the 3.8% Net Investment Income Tax, state capital gains tax, the mortgage interest deduction up to the $750K acquisition-debt cap, opportunity cost of any liquidated investments, and SBLOC interest carry over your chosen horizon.
The interactive calculator requires JavaScript. With JS enabled you can change home price, portfolio value, cost basis, tax bracket, state, expected returns, and lender rates — and see the after-tax cost of each path side-by-side.
Worked example — $1.5M home, $2M portfolio, 10 years
Same buyer, same home, three financing paths. Numbers below assume a $300K down payment requirement, 50% portfolio cost basis, 32% federal + 3.8% NIIT + 9.3% state (45.1% combined), 7% expected portfolio return, 6.5% mortgage rate, 8.5% SBLOC rate, 10-year horizon.
| Strategy | Cap-gains tax | Lost compounding | Interest cost (net of deduction) | 10-year total |
|---|---|---|---|---|
| Cash purchase | $67,650 | $240,140 | $0 | $607,790 |
| Traditional mortgage | $67,650 | $240,140 | $1,022,000 net | $729,790 |
| SBLOC | $0 | $0 | $165,600 | $165,600 |
Your numbers will differ — tax bracket, cost basis, expected return, and rate spread all change the answer. Use the calculator above to model your situation, or read the full SBLOC vs mortgage vs cash pillar guide for the full derivation, citations, and edge cases.
Three ways to fund a home purchase from an investment portfolio
If you're buying a home and you have a large taxable investment portfolio, your three options are not equal. Each has a different tax consequence, a different opportunity cost, and a different risk profile. Stockstead compares them side-by-side with the math your mortgage calculator is missing.
Pay cash
Liquidate enough of your portfolio to cover the full purchase. Simple, but you realize capital gains — up to federal 20% + 3.8% NIIT + state — and you lose future compounding on the money you pulled out. For a long-held, appreciated portfolio, this is usually the most expensive option. See the worked example on why this often costs more than it appears.
Traditional mortgage
Put 10–20% down and finance the rest. Your portfolio mostly stays invested, and mortgage interest on the first $750K of principal is tax-deductible on a primary residence. You still realize some capital gains on the down payment, though, and rates matter — at 6%+ mortgage rates, interest compounds fast over 30 years.
SBLOC (Securities-Backed Line of Credit)
Borrow against your portfolio rather than selling it. No capital gains event; your portfolio stays invested and compounding. The trade-offs: higher variable rates (typically prime + 1–2%), margin-call risk if markets fall, and interest is generally not deductible the way mortgage interest is. For the mechanics — advance rates, maintenance ratios, and how margin calls actually trigger — see our complete guide to how an SBLOC works. For the strategic decision framework on buying a home without selling investments, read the deep-dive. The full three-way comparison with a $1.5M worked example is in our pillar guide.
What the calculator does
You enter your purchase price, down payment, portfolio value, cost basis, tax bracket, expected returns, and time horizon. Stockstead computes the after-tax cost of each option — including federal + state capital gains, the 3.8% Net Investment Income Tax, opportunity cost, and SBLOC interest — so you can see which strategy actually wins for your situation. No signup. No data leaves your browser.
This is an educational tool, not personalized financial advice. Always confirm a strategy with your tax and wealth advisors before acting.
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