So I need some money. But the market being so uncertain, I don’t want to sell my mutual funds now.
I am seeing Smallcase offer me a loan against my Mutual Funds for 10.5% interest. The amount offered is about 33% of my portfolio.
Should I go for this?
Has anybody taken a loan against their mutual fund holdings? Pros and cons please.
Expensive for a collateralised loan.personal loan might be cheaper if your CIBIL score is good.
@tarun_rao Thanks. I’ll check for personal loans as well.
Not worth it. They take minimum Rs. 999 processing fees or 1% (which ever is higher) of loan taken upto Rs.4999. You can read about it here -Loan Against Mutual Funds (LAMF) FAQs.
Best option is to sell imo.
Are there any other avenues to get low interest loans?
Most personal loans have 10% + interest rates and additional charges like processing fees.
You can get lower interest rate if you have some collateral like Gold/home. But I still suggest selling MF is your best option imo. Markets are at all time high and FII are selling daily. This just seems like a fake rally so FII can sell all their stocks and also make some money from F&O and exit India until things settle down.
If you are salaried, personal loan is better. The interest rate would be around the same.