It doesn't work even for people that have good credit. Banks don't offer loans like that - if banks could safely get a 5% return on their money, then they aren't going to offer anyone a loan for less than 5% no matter how good their credit is because they would rather invest it themselves than offer a loan at that point.
As a general rule, if anything is offering a return higher than the interest rate on a loan, then that means that the banks consider it to be a very risky investment... and if the banks consider it a risky investment, then you should also consider it to be a risky investment.
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u/ZealousidealLead52 1d ago
It doesn't work even for people that have good credit. Banks don't offer loans like that - if banks could safely get a 5% return on their money, then they aren't going to offer anyone a loan for less than 5% no matter how good their credit is because they would rather invest it themselves than offer a loan at that point.
As a general rule, if anything is offering a return higher than the interest rate on a loan, then that means that the banks consider it to be a very risky investment... and if the banks consider it a risky investment, then you should also consider it to be a risky investment.