The facility is available for resident Indians only, NRIs are not allowed. Investment in stocks and mutual funds are made through banks, so your bank will give you the loan on the basis of your investment value by date.
Loan amount varies from minimum Rs. 50,000/- to maximum Rs. 20 lakh.
Similarly, if you have invested Rs. 5 lakh in mutual fund and its’ current valuation is Rs. 8 Lakh then you are eligible to get a loan maximum 50% of Rs. 8 Lakh i.e. Rs. 4 Lakh.
This facility is available to meet contingencies and needs of personal nature. For any sudden situation like health
You need to pledge of the securities i.e., Stocks or Mutual fund against which loan will be sanctioned.
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Following documents are required.
- Passport size photograph of the applicant.
- Know your customer documents.
Features of Loan against Securities
Processingfee is nil.
- Loan tenure is annual and renewal per year.
- As you have
pledgethe Stocks or Mutual Funds in the demataccount, so no other security is required. Loanamount is calculated on the basis of the valuation of your share price or the accumulated money in mutual fund folio.
Interest rate varies from bank to bank. Banks receive
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sharemarket Step by Step
The total loan with interest can be paid off within the maximum 30 months from the date of sanction of the loan against securities.
If you have any question regarding loan against shares or securities feel free to comment so that we have a discussion. If you have found this post helpful share this post with your loved ones.