About Loan Against Bank FD’S

It is a short-term loan, taken making an existing bank FD as collateral security. The bank offer loan up to 90 % of the value of the fixed deposit. The rate of interest is 1-2% above the rate of fixed deposit. The tenure of loan can’t exceed tenure of the deposit. This is the best option at the time of emergency in the family.

Eligibility for taking loan

It depends upon different banks, as different policies are followed by different banks for their esteem customers. SBI bank uses following criteria for eligibility.

  1. Existing customers having SBI’s TDR/STDR / RD account avail loan against SBI FD.
  2. Customers having NRE/NRO/RFC and FCNR (B) deposits can also apply.
  3. Single and joint account holders- both can apply for loan against SBI Fixed Deposits

Why should loan against Fixed Deposits be taken?

  1. Loan taken against your fixed deposit account can help you get short-term money for any kind of financial requirements without breaking your FDs.
  2. You can get a loan at comparative and lower rates of interest than other personal loans as they are unsecured loans. Loans against FDs have secured loans with the underlying deposit in your FD account.
  3. Banks in India offer a maximum loan up to 90% of the value of your fixed deposit.
  4. You can access the loan amount with a checkbook, ATM and internet banking with banks like Axis Bank.
  5. Loans against fixed deposits can be taken for any tenure as long as it does not exceeds the tenure of your fixed deposits.
  6. Loans are available to self and third party individuals including corporate organizations.

Documents need for availing loan against fixed deposits

  1. Duly filled an application form.
  2. Duly signed the agreement between bank and borrower.
  3. Fixed deposit receipt duly discharged in favor of the bank.
  4. Amount took as a loan.
  5. The minimum amount is Rs 25000.
  6. The maximum amount is Rs 5 crore.
  7. Depending upon the amount available in Fixed Deposit account of the customer.
Fixed Deosit, WealthhunterIndia