Loan against shares: A quick insight!

Have you invested in assets such as mutual funds, shares, bonds, FMPs, and more? Are you facing some financial crunches and thinking of liquidating your shares?

Hold your decision as you can easily grab a higher value of loan against shares. The deposited money in the shares is considered as collateral by lenders to offer you access to money.

You can always avail a loan against shares facility from a leading non-banking finance (NBFC) company at a lower interest rate in India. NBFC like Bajajfinserv are always available to provide loan against share at a very low interest rate in India.

You can apply for a loan against shares facility from a leading lender or a non-banking finance company (NBFC) at a lower interest rate. You also get the freedom to use the borrowed money to fulfil your many needs and goals.

How does the loan against shares work?

If you are planning to apply for a loan against shares, you need to consider some basic inputs such as:

1)The loan against shares facility is available by banks and non-banking finance companies (NBFCs) only to individuals. Joint business owners and companies are not eligible to opt for the facility.

2)The loan against shares value can’t go above 50% of its market value.

3)The repayment for the loan against shares is to be done via monthly EMIs and includes only the interest fees. You can settle the principal only at the end of the loan tenor.

4)You can grab the overdraft facility on your loan amount at a reasonable loan against shares interest rate.

5)The loan tenor is 1-year by default, after which it may get an extension for 1 more year. As per a customer’s needs and preference, he/she can also extend the tenor further.

6)You can also make prepayments towards your loan against shares account. You are also eligible to foreclose the loan account before the stipulated tenor. The most important part is that a borrower need not pay any extra charges for enjoying the discussed facilities.

Are you eligible for the loan against shares facility?

You need to fulfil some standard loan against shares eligibility conditions to become eligible for the facility such as:

-An applicant needs to be a resident of India

-The age of the borrower needs to be at least 21 years

-He/she should be either be a working professional or self-employed with a consistent source of income

-The minimum worth of your securities/portfolio should be at least Rs.10 lakh

-The maximum loan that you can get is up to Rs.10 crore from leading lenders

If you ever face any financial emergencies and need some money, it may be a smart idea to use your assets such as shares to apply for one.

Yes, instead of liquidating it and losing the planned return on investment on it, you should apply for a loan against shares. This way, you can cover many personal and professional needs super easy.