You need money urgently and you have a fixed deposit to break ???. Well don’t break the Fixed deposit, instead, get a loan against your Fixed deposit. It is a fast process, all you need is to sign few forms and get them, unlike other loans this is pretty fast on approval. Because it is a secured loan against your FD.
There are few benefits with this loan against FD,
First and foremost is you don’t need to break the FD and take the penalty, which will save your FD and the rate of interest return you took during the time of your FD. Because you break the FD and again you deposit, banks will only consider the current rate of interest for returns.
Less interest rate for your loan, since it’s a secured loan you will have a low interest rate and you can prepay the loan without any extra penalty. That is a win-win situation right?
Fast processing, there is no delay in the process and no check on your CIBIL score. It’s all smooth and you will get your loan approved within a day. Some banks have an online process which makes it even simpler.
You can take loan on up-to 90 % of your Fixed deposit, and no special processing fess on this loan,
You cannot take this loan if the FD is on minor applicants name .
And if you are not paying the EMI for this loan, the bank will take the amount from your Fixed deposit. Like if your loan against FD is @ 12% interest and your FD returns are @ 9% the balance of 3 % will be taken from your FD.
Fixed deposits are long-term investments for many. But when you need money in an emergency situation. All you can do is take a loan against FD. This way you will save from breaking the FD and also get to manage your emergency situation.
Good to know! Great post, Lijo
Thanks shweta 🙂