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LAS /LAP

Loans Against Securities (LAS) is a type of overdraft facility wherein you need to pledge mutual fund units as collateral and get a loan ranging from Rs.2 Lacs to 10 Crores. To meet your immediate fund requirement LAS is the best option rather than selling your existing investment.
You don’t have to provide any additional security or collateral except the securities you are pledging!

Why LAS?

Quick Access to Finance

Pledge your MF units and get an instant loan to meet your financial requirements without liquidating your investments.

Interest in Utilization

One of the biggest benefits of LAS is that interest is charged only on the amount withdrawn and for the period it is being utilized.

Retention of Ownership

LAS facilitates you to reap benefits that come from your investments as you still enjoy the ownership of mutual fund units.

Zero Part-Payment and Foreclosure Charges

As there are no prepayment and foreclosure charges you can repay your loan at your convenience.
The amount of loan you are eligible for depends on the value of the securities you offer as collateral.

Eligibility

To apply for a Loan against Securities, you must meet the following eligibility criteria:

  • Loan will be available in the name of Primary holder only
  • Applicant must be a resident citizen of India
  • Applicant must be in the age group of 18 to 70 years
  • This facility is not available to HUF, NRIs & Minors
  • Loans are granted only against the list of approved Mutual Funds/Scheme

Loan Against Property:

Even if you are a meticulous saver, there may be times when your finances are strained and you need a little help to tide you over. Though borrowing from family or friends is a preferred option for many, if the amount you need is large, it may not be a good idea to stress their finances as well. A better option would be to leverage an asset you own-your house.

You can use your house as collateral to take a loan from a bank. The latter will exercise due diligence as far as the property is concerned, appraise its value, and offer you up to 70% of its value as loan. Since this is a secured loan (you are offering a collateral), you can get a higher amount than the one you will get for an unsecured loan like a personal loan.

Of course, you will also have to pay the administrative and processing fee, which is usually 0.5-1.5% of the value of the loan. Typically, the tenure for such a loan is 1-9 years, but some banks may be willing to extend it to 15 years if the loan is large. The interest rate, which can be floating or fixed, varies from 12-16%, which makes them cheaper than personal loans.

Taking a loan against your property is certainly cheaper than a personal loan, where the interest rate is usually between 14% and 22%. The only loan that is less expensive than the one against a property is a home loan.