Avail Loan Against Mutual Funds Without Impacting Your CIBIL Score

Unlock Cash From Your Investments

Don't Sell, Borrow Smartly with a Loan Against Mutual Funds.

Access liquidity without disrupting your long-term investment goals. Get a loan in minutes using your existing mutual funds.

Apply for Loan Against Mutual Fund
  • Maintain an intact investment portfolio.
  • Convenient online application process.
  • Lower interest rates compared to unsecured loans.

What is a Loan against Mutual Fund ?

Loan Against Mutual Funds (LAMF) is a loan that customers can obtain by using their mutual funds as collateral.

Collateral-Based Loan

LAMF is a type of secured loan that uses mutual fund units as collateral. This means that you can borrow money by using your mutual fund units as a guarantee for the loan. It provides a way for individuals to access funds without having to liquidate their mutual fund holdings.

Flexibility in Loan Amount

The loan amount is determined based on the assessed value of the mutual funds you pledge as collateral and the lender's loan-to-value (LTV) ratio. Therefore, the flexibility in loan amount is contingent on these factors and may vary accordingly.

Attractive Interest Rates

LAMF generally provides more attractive interest rates compared to unsecured loans because they require collateral. This lowers risk for the lender and allows them to offer better terms for borrowers.

Minimal Impact on Investment

You can maintain ownership of your mutual funds, which helps to sustain your potential growth and have a minimal impact on your investment.

Why Choose a Loan Against Mutual Funds?

Quick Access to Cash

Competitive Interest Rates

Keep Your Investments Growing

Flexible Repayment Options

Minimal Documentation

Faster Processing

Get Started in 4 Easy Steps

Step 01

Apply Online

Submit a quick application with details of your mutual funds.

Step 02

Digital KYC

The KYC process is completely digital and there is not much paperwork.

Step 03

Assessment

The total mutual fund portfolio will be assessed by experts to determine your credit limit.

Step 04

Get Approved

Receive a loan offer based on your eligibility and fund value.

Eligibility for Loan Against Mutual Funds (LAMF):

  • Age: Between 18 and 65 years old (may vary depending on a lender).
  • Minimum Investment: A minimum value of ₹ 50,000 in your mutual fund portfolio (may vary)
  • Mutual Fund Scheme: Holding funds approved by specified registrars like CAMS & KFintech (RTAs). Debt and ELSS funds are often excluded.
  • Residency: Indian residency is mandatory

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Frequently Asked Questions (FAQs)

GETTING STARTED

A: A Loan Against Mutual Funds (LAMF) is a secure way to borrow money by using your mutual fund investment as collateral. With this option, you can access cash while keeping your mutual funds intact, which can be beneficial in meeting financial needs without compromising your long-term investment objectives

A: LAMF loans typically do not require a hard credit inquiry, so your credit score is minimally affected. Some lenders may perform a soft inquiry, which does not impact your score

A: Yes, prepayment is generally permitted for LMAFs but be aware that certain lenders may enforce a prepayment penalty if done too soon. It is important to carefully go through the loan terms to know about any potential prepayment fees.

The maximum loan amount you can get is between 50% and 70% of the total mutual fund value.

A: It is important to note that the interest paid on a loan against mutual funds is typically tax-deductible, just like with other types of loans. However, it is always a good idea to seek the advice of a tax professional for personalized guidance based on your prevailing circumstances.

A: Interest rates for LAMFs depend on the lender, loan amount, and your creditworthiness. They tend to be lower than unsecured loan options but generally higher than interest rates on certain mutual fund investments.
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