Fidelity Investments and GMAC Mortgage Corp. launched a program Wednesday that allows Fidelity brokerage customers to use their assets as security for mortgage loans from the General Motors unit.
The companies said the pledged-asset program, available to customers who have an activated margin feature on their accounts, would eliminate the need to liquidate assets for a down payment.
Customers would be able to trade, redeem, or exchange pledged assets as long as the required level of equity is maintained in the account. However, if the market value of the account declines, the customer might be required to deposit more money or securities. If the customer is unable to do so, Fidelity might have to sell all or some of the pledged assets.
The program will offer fixed, adjustable rate, and balloon payment mortgages. Fidelity customers would receive preferential fees. Applications would be handled by specially trained GMAC mortgage specialists.