In case of sudden need of money, you may have to take a loan. There are many options for this. You can take loan against FD, gold loan or mutual fund loan. Personal loan is also an option. Everyone has their own merits and demerits. Its parameters are interest rate, convenience of getting loan immediately and less documentation required. On this basis, which short-term loan option would be better? Let us understand… Mutual Fund Loan: Keep in mind the market related risks. Mutual funds can be used as security for the loan. Its interest rate is currently 12-14%. In this, long term investment is also maintained and necessary cash is also available. However, there are ups and downs in the stock market. If the price of mutual fund units falls before the loan is repaid, you may have to sell additional units to maintain the loan ratio. This may cause harm. This aspect should always be kept in mind. Personal Loan: Interest rates are high, up to 17-18% interest has to be paid on personal loans this year. These are one of the best options to meet your immediate need for money, but they must be repaid quickly. But avoid taking loan on credit card. On these, 30% or more interest has to be paid annually. However, other options are better in terms of interest rate. Loan against FD: Along with loan, savings also remain intact. You can take loan against bank FD without breaking it. In this way, along with the benefit of maintaining the savings deposited in the bank, one also gets the necessary cash. The interest rates applicable on FD loans (12-15%) are also lower than personal loans. This loan is also easily available immediately. Also, there is no need to submit many documents to the bank for this. Gold Loan: Gold loans have become attractive these days due to low interest rates and gold prices reaching Rs 75,000 per 10 grams. Now you will get more loan than before on mortgaging jewellery. Compared to personal loan, interest is charged at a lower rate (10-12%). However, if you default on loan repayments, your gold may be confiscated. Additional charges may also apply.
