YOUR QUERIES: You can take a personal loan from a bank against your fixed deposits
By Chaitali Dutta
I have deposits worth Rs 20 lakh in banks. Can I pledge the FDs and get a loan at a cheaper rate from a bank? Yes, a loan against FD may be availed from the same bank without premature withdrawal. Your deposit continues to grow at the pre-fixed rate unhampered. You pay interest a few basis points higher than the FD rate, for the period for which you avail the loan. If you do not repay the loan, on maturity, the FD proceeds will be used to first close the loan and the balance amount transferred to you.
About 50% of my fixed income investments is parked in my Over-draft Account for my home loan in SBI. It earns 7.7% interest (saves that amount from my loan). Should I keep it here or move it to a different instrument or pay off
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