Supercharge Your Mutual Fund Investments with Loan Against Mutual Funds

A Safe Alternative to Get You Through Financial Emergencies

Unexpected financial needs can arise at any time. Selling your mutual fund investments might seem like a quick solution, but it could disrupt your long-term financial goals. Instead of liquidating your portfolio, you can leverage a Loan Against Mutual Funds (LAMF) to access instant funds while keeping your investments intact.

This option allows you to borrow money against your mutual fund holdings, giving you the liquidity you need without sacrificing potential returns. Let’s explore how a Loan Against Mutual Funds works, its benefits, and why Liquify is the best platform to help you access this facility seamlessly.

What is a Loan Against Mutual Funds?

A Loan Against Mutual Funds is a secured loan where your mutual fund units are pledged as collateral. Instead of selling your investments, you use them to get a credit line or lump sum amount, which you can repay over time.

This facility is ideal for individuals who need funds for business expansion, medical emergencies, education, or any other urgent financial requirement. The loan amount depends on the value of the mutual fund units pledged and the lender’s margin requirement.

The Margin Requirement on Mutual Fund Units

The margin requirement is the percentage of the mutual fund’s Net Asset Value (NAV) that a lender considers while approving the loan amount. It varies based on the type of mutual fund:

✔ Equity Mutual Funds – Loan amount up to 50% of the NAV
✔ Debt Mutual Funds – Loan amount up to 80% of the NAV

The final loan amount depends on the lender’s policies and the volatility of the pledged assets.

Interest Charged on Loan Against Mutual Funds

The interest rate for a Loan Against Mutual Funds is usually lower than unsecured personal loans because it is a secured loan. The rates depend on:

✔ The type of mutual fund pledged (Equity funds typically attract higher rates than debt funds)
✔ The lender’s policies and market conditions
✔ Your credit profile and repayment history

Interest is charged only on the amount utilized, making it a cost-effective financing option.

What Are the Benefits of Availing a Loan Against Mutual Funds?

✔ No Need to Sell Investments – Keep your portfolio intact and continue earning potential returns.
✔ Lower Interest Rates – More affordable compared to personal loans and credit cards.
✔ Quick Disbursal – Faster loan approval with minimal documentation.
✔ Flexible Loan Amounts – Borrow as per your financial requirements.
✔ Pay Interest Only on Used Amount – You are charged interest only on the amount utilized, reducing costs.
✔ Credit Line Facility – Withdraw funds as needed and repay flexibly.

When Should You Apply for a Loan Against Mutual Funds?

You can consider a Loan Against Mutual Funds in situations like:

✔ Short-term cash flow needs without disturbing long-term investments.
✔ Medical emergencies requiring immediate liquidity.
✔ Education expenses for higher studies or professional courses.
✔ Business expansion or working capital requirements.
✔ Debt consolidation to reduce high-interest burdens.

This option is best suited for investors who want quick funds while keeping their wealth-building strategy intact.

How to Apply for a Loan Against Mutual Fund?

Applying for a Loan Against Mutual Funds is easy with Liquify:

Step 1: Visit the Liquify website and select “Loan Against Mutual Funds.”
Step 2: Enter details of the mutual fund schemes you wish to pledge.
Step 3: Complete KYC verification and submit required documents.
Step 4: The lender marks a lien on your mutual funds as collateral.
Step 5: Upon approval, funds are credited to your bank account.

The entire process is 100% digital, paperless, and hassle-free.

When and How to Close a Loan Against Mutual Fund?

Closing your Loan Against Mutual Funds is straightforward:

✔ Repay the loan amount along with any outstanding interest.
✔ Once the payment is complete, the lien is removed, and your mutual funds are unblocked.
✔ If you have a credit line facility, you can prepay without penalties (subject to lender policies).

It’s advisable to prepay your loan whenever possible to minimize interest costs and regain full control over your investments.

Why Choose Liquify for Your Loan Against Mutual Funds?

Liquify is a trusted lending platform offering seamless Loan Against Mutual Funds with the following benefits:

✔ Instant Loan Disbursal – Quick processing and same-day approvals.
✔ No Hidden Charges – Transparent fee structure with no surprises.
✔ Competitive Interest Rates – Lower than personal loans and credit cards.
✔ Digital & Hassle-Free Process – Apply from anywhere, anytime.
✔ Flexible Repayment Options – Pay interest only on the utilized amount.

By choosing Liquify, you unlock liquidity from your investments while keeping them intact and growing.

Conclusion

A Loan Against Mutual Funds is an efficient way to access funds without selling your assets. Whether it’s for an emergency, investment opportunity, or business requirement, this option ensures financial flexibility at lower costs.

Liquify makes borrowing against mutual funds easy, fast, and affordable. If you need liquidity without disturbing your investment strategy, apply with Liquify today!

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