Loan against mutual funds, as the name suggests, is a secured/ mortgage-based credit scheme offered by varied financial institutions in India. As a part of this scheme, lenders allow the borrower to use their mutual funds investment as mortgage and avail the applicable amount as loan.
That said, getting approved for this loan would be a difficult task as long as you don’t have the borrowing eligibility. However, you can follow the below-shared tips to improve your chances and get approved every time you apply for a loan against your mutual funds.
Develop a Strong Investment Portfolio
Higher financial worth is directly taken for better repayment capacity which later helps in getting approved faster. So, while you are not planning to take a loan, work towards improving your financial worth. Make a strong investment portfolio by investing in varied, high return investment schemes.
Maintain a Good Credit History
Secondly, maintain a good credit history along with a good credit score. This would help you in future to get approved for a loan.
Verify That The Units Comply With The Lender’s Scrip List
Third but most important point is to check if the mutual funds you own is accepted by lenders or not. You can check their scrip list to get an idea.
Apply Online Or At Authorised Offline Centres
Lastly, irrespective of whether you apply online or offline, ensure the lender is credible. You can check online reviews which are a pretty good way to determine any product or service provider’s credibility. You can also take help from other people who took a loan from the same lender as you.