I have several private student loans that aren't eligible for debt forgiveness and with interest rates between 10-15%, for a total of about $30K. I think it would be easier to pay the loan down over the next 5-10 years or so if the interest rate was so lower, so I could make the minimum interest payment AND put more toward the principal. So, I'd like to reduce the interest rate I pay.
I have about $12K in my brokerage account that I can borrow almost the entire amount, AND withdraw it, in cash. The interest rate on margin balances with my broker is 1.58% right now, so I could borrow another 12K, withdraw my 24K from my brokerage account, and significantly pay down some of my private student loan debt and in fact pay off some of the debt with the highest interest rate.
What's wrong with this? I know that interest rates on margin can change, and the interest rates on my student loans are fixed, but I don't think margin rates would get up over 10%, right?