My question is, will IB subtract my cash balance in deciding my margin loan, i.e. is my margin loan $40K ($100K borrowed minus my $60K cash balance) or the full $100K?
I won't be touching that $60K cash since it's part of my 12-month cushion.
Treading carefully since I am new to margin investing. Thanks for your advice.
Reinforcing what Financial.Velociraptor said, you have cash or loan, not both. I first got approved for margin at Vanguard, but there was no interface for a loan. Your first time, it's probably a little freaky... you just spend past zero. I bought assets I couldn't afford, then called Vanguard to ask if this was how it's done. And it was.
Your negative balance is your margin loan. So you must touch that $60k if you want a margin loan. You would look at $60k cash, and request a $100k withdrawal. You'll be surprised when it goes through! And your cash will go negative, -40,000.
I forget when IBKR actually updates it, but on day 2, you have a -40,001.77 loan. The interest you owe becomes another negative amount. I don't know if they update every day, or week, or month. But your margin loan grows at 1.58%.
When you sell assets or deposit money, it gets applied to your loan. So if you sold $20k of assets, you wouldn't have a positive cash amount. Your margin loan would go from -40,001.77 to -20,001.77.
EDIT: IBKR charges 1.58% on the first $100k
https://www.interactivebrokers.com/en/trading/margin-rates.php