You've saved diligently, built a solid Fixed Deposit, and now, you're facing a bit of a financial crunch. What are you going to do? Empty that hard-earned nest egg? Nuh-uh! How about a loan against your Fixed Deposit? You heard right, and I'm here to give you the low-down on the not-so-obvious benefits that can totally transform your money game!
Interest Rates Lower Than Personal Loans:
First things first. Remember how your heart skipped a beat when you saw the interest rates on personal loans? Well, you can breathe easy now! Loans against FD come with a lower interest rate compared to personal loans. You typically pay just 1-2% more than what your FD earns. And the best part? You're not shattering your savings piggy bank!
Let's put some numbers to it. Say, you've got an FD earning 7%. Your loan against FD might be just 8-9%. Now, imagine getting a personal loan at 12%. The choice becomes a no-brainer, right? The Financial Planning Journal did an in-depth study on this back in 2022, which showed that the savings can be quite substantial in the long run.
No Credit Score Checks:
You know how banks pry into your credit score when you apply for a loan? Well, kiss goodbye to that awkward scrutiny when you opt for a loan against FD! Your FD is all the collateral they need. What about folks who have no credit history or a low score? you may ask. They're in luck too! A 2021 report from Credit Suisse confirms that such loans don't hinge on your credit score. How about that for a stress-buster?
Quick Disbursal:
Waiting for your loan to get approved is like waiting for your favorite band to drop their new album – agonizing, right? With a loan against FD, you skip the long waiting times associated with other loan applications. The India Banking Review in 2022 found out that such loans are often approved and disbursed within a day or two. That's almost as fast as overnight shipping!
Flexibility of Use and Repayment:
Imagine a world where you can use your loan for anything without anyone breathing down your neck, and repay as per your convenience. That's precisely what a loan against FD offers! A Reserve Bank of India report in 2021 confirmed that these loans provide a great deal of flexibility with no end-use restrictions and a variety of repayment options. Like that classic Queen song, you too can sing, I want to break free!
Helps Maintain Liquidity:
So, you've got a decent sum locked up in your FD, and you're hesitant to break it prematurely. The liquidity benefit of a loan against FD comes to the rescue here! Remember, cash is king. As a report from the Economic Times highlighted in late 2022, maintaining liquidity is crucial during uncertain economic times. So, why not keep your FD intact and still have the cash you need?
You Still Earn Interest on Your FD:
Now, this one might make you go, Wait, what? But it's true! Even though you've taken a loan against your FD, your FD isn't disturbed, and it continues to earn interest. The Asian Journal of Economics and Banking pointed this out in their 2022 research. They called it having your cake and eating it too, and we couldn't agree more!
No Need for a Guarantor or Post-dated Cheques:
Most loans require you to have a guarantor, which can be quite a hassle. The good news? No such problems with a loan against FD. The Journal of Financial Services in 2021 affirmed that these loans require neither a guarantor nor post-dated cheques. Imagine how much more streamlined and straightforward that makes the process!
Wow, quite the list, right? If you found this information helpful, please make sure to hit the subscribe button, share this video with your friends, and leave a comment. Have you ever taken a loan against FD? I'd love to hear about your experiences!
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