Be it a small/big business or a regular individual working 9 to 5 to earn his livelihood, both of them have one thing in common - they both are equally prone to fall a victim to financial urgencies despite unmatched financial management skills. Thus, both individuals and entities are likely to liquidate their investment to meet the financial shortfall - which will leave them vulnerable to financial urgencies which might incur in future, or apply for a short-term loan - wherein the eligibility will be a big issue. Therefore, there is a need for a third alternative: something which can help in managing the shortfall along with preserving the short-term and long-term financial assets - a loan against shares.
A loan against property is a type of secured loan which allows potential applicants to borrow a certain amount of capital by mortgaging their securities. The obtainable financing depends on multiple factors like the market value of the property, applicant’s loan eligibility, and the gross monthly income of the person. The borrowed capital can be used for multiple reasons including the ones mentioned below.
Managing the gap in working capital
Business entities can mortgage their short and long-term securities to use the borrowed capital to manage the shortfalls in their working capital.
To pay for medical expenses
An individual can use securities like a life insurance policy, mutual funds bond etc. to obtain a loan against it and utilize the sum towards paying the medical expenses.
To pay for other personal expenses
Lastly, owing to the end-usage flexibility available with a loan against shares, the borrower gets the freedom to use the money for their personal cash needs.
Read More:- How to Put your Loan Against Shares to Good Use?
Alisha Antil is your best financial helper for insurance. She has a vast experience in finance and insurance and provide to you the expert advise in insuring your property and health.
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