If you are seeking instant money or liquidity during an emergency, you can avail for a loan against securities. Rather than selling your securities and losing the interest benefits, you can pledge them with a lender and get a loan. The good news is that when you opt for such a loan, chances are high that you will get more loan amount, depending on the kind of investments have.
Some lenders are more than willing to offer loan against securities amounting to INR10 crore at a low-interest rate, but it all depends on the types of investments you decide to pledge. Here are some details that you should know if you are looking to put up your securities as collateral.
Lenders have their own eligibility criteria for a loan against securities. However, the common criteria across all lenders are as follows:
- Applicant should be a minimum of 21 years
- Applicant should be a citizen of India
- Applicant should have a monthly income through salary or self-employment
- The securities portfolio should be worth a minimum of INR10 lakh
When you apply for this loan, you would have to furnish the following documents:
- ID proof in the form of driving license, Aadhaar card or PAN card
- Address proof (Aadhaar card)
- Proof of securities that the applicant has invested in
- Coloured passport size photograph
Typically, loan against securities has nil prepayment and foreclosure charges. Hence, you can foreclose the loan or make prepayments without worrying about added costs. Most financial institutions and NBFCs provide this type of loan. Just get in touch with the relationship manager of the organisation to find out if you are eligible for it.