Personal Loans for Investing:
Smart Ways to Use Borrowed Money
Thinking of Taking a Personal Loan to Invest? Here’s What You Should Know.
A personal loan can help you grow your money, but only if you use it wisely. Borrowing money can open up new opportunities you wouldn’t be able to afford otherwise, like investing in:
But let’s be real—not every investment is worth borrowing for. If you’re paying more in loan interest than you’re making in profits, you’ll end up losing money instead of growing it.
That’s where Bluebricks comes in. We help you find the right personal loan that fits your investment goals, with low interest rates, flexible repayment terms, and expert advice to reduce risks.
How Does Borrowing to Invest Work?
Taking a personal loan to invest is called financial leverage—using borrowed money to generate bigger returns than you could with just your own cash.
If the investment goes well, you can make more money than you borrowed. But if it doesn’t, you’ll still owe the bank—loan payments don’t stop just because an investment flops.
Best Ways to Invest with a Personal Loan
Not all investments are worth taking a personal loan for. Here are some of the smartest ways to use borrowed money:
Buying property for rental income or flipping can be a solid long-term investment. A loan can help cover down payments, renovations, or new property purchases.
Example: Taking an RM30,000 loan to renovate a property and selling it for an extra RM100,000, making an RM70,000 profit.
Or
Taking an RM30,000 loan to renovate a property and increasing rental income by another RM1,000 per month.
If your business is already making money, a loan can help it grow faster. The funds can be used for new equipment, more inventory, or better marketing.
Example: A café owner borrows RM50,000 to upgrade kitchen equipment, allowing them to serve more customers and increase revenue.
Buying dividend stocks or index funds can provide steady, long-term returns. However, avoid using loans for risky short-term trading—market ups and downs can be unpredictable.
Example: Borrowing RM20,000 to invest in solid, blue-chip stocks that pay dividends every year with a project stock price growth of 6-7% per year.
Taking a personal loan for career growth is one of the safest investments since professional certifications or degrees can increase your salary and job opportunities.
Example: Borrowing RM10,000 for a tech certification that leads to a 30% salary increase within a year.
Why Interest Rates Matter When Borrowing to Invest
If your loan’s interest rate is higher than your investment return, you’ll lose money.
Example:
- A loan at 8% interest, used for an investment earning 6%, means you lose money.
- A loan at 4% interest, used for an investment earning 9%, means you make a profit.
That’s why it’s critical to compare loan rates and make sure your investment outperforms the cost of borrowing.
Testimonials
What our clients have to say:
When Does It Make Sense to Borrow for Investing?
When the Investment is Low-Risk with High Returns
Real estate, government bonds, and dividend stocks often generate stable profits.
Example: Taking a low-interest loan to invest in a government-backed bond that pays a higher return than the loan’s interest rate
When You’re Investing in Yourself
Education and skill-building guarantee better earning potential.
Example: A RM10,000 investment in a business course leading to a promotion and higher salary.
When You’re Investing in Yourself
When You Can Comfortably Afford Repayments
Even if your investment doesn’t go as planned, you should be able to handle loan payments.
Example: Taking an RM50,000 loan to start a business while ensuring monthly payments can still be covered by your salary, not just business profits.
When You’re Growing a Business That’s Already Making Money
A loan can help you expand faster if your business is already profitable.
Example: A boutique owner borrows RM80,000 to open a second store, doubling monthly sales.
Risks of Using a Personal Loan for Investing
Borrowing to invest can boost your profits, but it also comes with real risks:
- You Still Have to Repay the Loan, Even If the Investment Fails
- High Interest Can Eat Up Your Profits
- Too Much Debt Can Hurt Your Future Finances
- Market Risks Are Unpredictable
How Bluebricks Helps You Borrow Wisely for Investment
Getting a personal loan for investing is a big decision, and we make sure you do it the smart way—with the right loan, the best rates, and a solid plan. Here’s how we help:
Finding the Best Personal Loan for Your Investment Goals
We compare multiple banks to find a loan with low interest rates, flexible terms, and minimal fees so you don’t overpay.
Structuring Loans for Maximum Profit
A loan only makes sense if your investment earns more than it costs. We help structure repayments, so they’re affordable and aligned with your expected returns.
Helping Borrowers with Low Credit Scores
Struggling with bad credit? We work with banks that accept lower scores and help improve your financial profile for better loan options.
Speeding Up Loan Approvals
Opportunities don’t wait. We handle all the paperwork and bank submissions so your personal loan gets approved faster and you don’t miss a great deal.
Offering Smart Borrowing Advice
Not sure if borrowing is the right move? We guide you on which investments are worth it, how to reduce risks, and how to avoid financial strain.
Why Choose Bluebricks?
Licensed Brokerage Partner
Access to Multiple Banks
Transparent Loan Terms
Fast Loan Processing
Smart Borrowing Guidance
Transparent Service Fees
At Bluebricks, we prioritise clarity in our fee structure:
- No Upfront Costs: You pay nothing until your refinancing is approved.
- Service Fee Range: Our fee is 10%-30% of the approved loan amount, tailored to your situation (e.g., credit score, DSR, or AKPK involvement).
- Payment Timing: Fees are charged only after your refinanced loan is disbursed.
Example:
If you secure an RM100,000 loan with a 10% service fee, you pay RM10,000 only after receiving the funds.
Case Study
Wilson Wai Kit
Financial Advisor
With extensive banking experience, notably as a mortgage sales officer at UOB Bank, Wilson leverages his understanding of loan applications and approvals to offer financial insights and support to empower individuals to make informed decisions regarding their financial futures. Feel free to contact him for assistance with your financial needs!
Feel free to contact him for assistance with your financial needs!
Karl
Financial Advisor
Karl has a background in banking and real estate, with roles ranging from Mortgage Officer at UOB Bank to Director at Vestcom Realty. He’s skilled in managing mortgage loans and real estate projects and works closely with bank officers, money lenders, and lawyers to solve clients’ loan issues.
Karl is currently a key contributor to business loan development at Bluebricks.
Personal Loan for Investing – FAQ
Yes, but some banks have restrictions. While many allow loans for business, real estate, or education, some don’t permit stock trading, mutual funds, or crypto investments. Always check the loan terms before applying.
• More Investment Capital – Access more funds than what’s available in cash.
• Higher Returns – If ROI exceeds the loan interest rate, you make a profit.
• Diversification – Spread investments across different asset types.
• Business Growth – Expand a business without waiting to save up.
• Career Advancement – Fund education or certifications for higher future income.
• You Still Owe the Loan – Repayments continue even if the investment loses money.
• High-Interest Costs – If the loan rate is too high, it can wipe out potential profits.
• Market Uncertainty – Stocks, forex, and crypto can drop unexpectedly.
• Loan Eligibility Impact: Taking on more debt may limit your ability to get future loans.
Lower-risk, more predictable investments work best:
- Real Estate – Rental properties or house flipping.
- Government Bonds & Fixed Deposits – Stable returns with minimal risk.
- Business Expansion – Scaling a proven, profitable business.
- Education & Skill Growth – Certifications that boost long-term income.
High-risk investments, like stocks, crypto, and forex, can be unpredictable and are not ideal for loan financing.
Only borrow what you can comfortably repay, even if the investment underperforms. Loan payments also shouldn’t exceed 30–40% of your monthly income.
Consider alternative funding options like savings or employer investment programmes before taking a loan.
Loan rates depend on your credit score, income, and risk level:
- 3%-9% for high-credit borrowers with stable income.
- 9%-15% for moderate-risk borrowers.
- 15%-18% for high-risk borrowers with low credit scores or high debt levels.
If your investment earns less than your loan’s interest rate, it may not be worth borrowing.
If an investment doesn’t work out, you’re still legally responsible for loan repayments. Failing to pay can result in:
- Late fees & increased debt.
- Credit score damage, affecting future loan approvals.
- Legal action or asset seizure if the loan is secured.
To avoid financial strain:
- Have a backup repayment plan that doesn’t rely entirely on investment profits.
- Diversify your investments to reduce risk.
- Keep an emergency fund to cover payments if needed.
Some banks allow it, but it’s risky due to market volatility.
Risks of Using a Loan for Stocks:
- No guaranteed returns—market fluctuations can lead to losses.
- You still owe the loan even if stock values drop.
- A downturn could force you to sell at a loss.
Safer Alternatives:
- ETFs, dividend stocks, or index funds for long-term growth.
- Using savings instead of loans to minimise financial risk.
• Positive impact: On-time payments improve your credit history and future loan eligibility.
• Negative impact: Missed payments lower your score and increase borrowing costs.
• High DSR (Debt Service Ratio) – Too much debt can make it harder to get a mortgage or car loan.
As a licensed loan brokerage, Bluebricks help you secure loans with low interest rates and flexible terms. We help you borrow strategically by:
- Finding banks with low-interest loans and flexible terms.
- Structuring repayments to align with your investment growth.
- Offering financial guidance to minimise borrowing risks.
- Optimise your loan application for fast approval.
