How to Apply for a Loan Against Mutual Funds in India – Eligibility, Documents, Online Process 2025

In 2025, your mutual fund portfolio isn’t just an investment — it’s a powerful asset you can instantly leverage. If you’re facing a financial crunch, planning a wedding, or want to grow your business, Loan Against Mutual Funds (LAMF) is the smart, risk-managed way to raise funds without liquidating your investments.

This updated guide explains how to apply loan against mutual funds, the current LAMF interest rate for 2025, eligibility, documents, and more. It’s written with a human touch for real users searching for answers.

What is a Loan Against Mutual Funds & How Does it Work?

A loan against a mutual fund is a secured credit facility where your equity or debt mutual fund units are pledged to borrow money instantly. The value of your loan depends on the type of mutual fund and the LAMF LTV (Loan-to-Value) offered by the lender.

You retain ownership of the investment and continue to earn returns , while getting immediate liquidity.

Features of Loan Against Mutual Funds You Must Know

• Instant online process via LAMF API with top NBFCs & fintech platforms

• No CIBIL, no income proof, no paperwork needed

• Apply online anytime with Aadhaar, PAN, and folio details

• Available for both equity and debt funds

• Flexible repayment terms with part-payment & foreclosure options

These features of a loan against mutual funds make it a preferred alternative to gold or personal loans.

Who Can Apply for Loan Against Mutual Funds in 2025?

If you’re wondering who can apply for a loan against mutual funds, here’s the answer:

• Salaried employees with SIP or lump sum MF holdings

• Self-employed professionals with debt or hybrid fund portfolios

• Students or homemakers (if holding investments under guardianship)

• Pensioners or retirees with a steady mutual fund NAV

Compare: LAMF vs Personal Loan vs Gold Loan

LAMF vs personal loan vs gold loan comparisons show that LAMF provides lower rates and digital convenience.

LAMF LTV: Equity vs Debt Mutual Funds

Your approved loan amount depends on the loan against mutual fund LTV:

• Equity Mutual Funds: Up to 80% LTV

• Debt Mutual Funds: Up to 85% LTV

For example, if you hold ₹10 lakh in equity MFs, you can borrow ₹8 lakh. Use a loan against mutual fund calculator or LAMF eligibility calculator from platforms like Investkraft or Volt Money to know your exact amount.

Loan Against Mutual Fund Documents Required (2025)

You won’t need bulky files. Just keep this ready:

• PAN card

• Mobile-linked Aadhaar (for KYC verification)

• Demat account or folio number access

No salary slip, no bank statement. This digital loan against mutual fund process is quick and paperless.

Best Interest Rate Offers for LAMF in 2025

Lenders and platforms offer competitive loans against mutual fund interest rate packages:

Before choosing, check the an against mutual fund review pages or Reddit threads under LAMF experiences on Reddit to know user satisfaction.

Risks of a Loan Against Mutual Funds

Understand these before applying:

• Loan Against Mutual Fund Margin Call: If the NAV drops below a threshold, the lender may ask for partial repayment or more units.

• Risk of LAMF NAV Drop: Volatility in equity can reduce your available margin.

• Redemption Lock: Pledged funds can’t be withdrawn until the loan is repaid.

Still, for short-term needs, LAMF loans for financial needs (like education, wedding, or business) are safer than selling your funds.

How to Apply for a Loan Against Mutual Funds Online

Wondering how to apply loan against mutual funds in 2025? Follow these steps:

1. Visit a digital platform (Volt, Investkraft, Bajaj Finserv)

2. Use their apply for loan against mutual fund section

3. Enter PAN and authenticate MF folios

4. Check the eligible amount via the loan against mutual funds eligibility calculator

5. Accept the terms and get funds in your bank

The entire process is paperless, CIBIL-free, and instant.

When Should You Take a LAMF Loan?

Use a loan against mutual funds for weddings, travel, school fees, or emergencies where you want to retain your investments. Even if you earn ₹40,000/month or less, this is a better option than credit cards or high-interest personal loans.

Loan Against Mutual Funds Limit & Duration

• Minimum Loan: ₹5000

• Maximum Limit: ₹50 lakh+ (depending on MF NAV)

• Duration: 3 months to 3 years (flexible)

• Processing Fees & Interest Rates: 0.5% to 2%, based on the lender

Final Thoughts: Smart Finance with Mutual Fund-Backed Loans

In 2025, leveraging your investments via LAMF is smarter than selling or taking unsecured loans. It offers low rates, no paperwork, flexible tenure, and digital convenience.

Whether you’re using an Investkraft loan, Volt Money’s instant disbursal, or applying through your bank, the loan against mutual funds explained here will help you make a confident choice.

Don’t let your MF sit idle — unlock liquidity with zero stress and continue growing your wealth.

FAQs

Q1. What is a loan against a mutual fund in simple terms?
It’s a secured loan where your mutual funds are pledged for instant liquidity, without selling them.

Q2. How much can I borrow through a LAMF loan?
Up to 80–85% of your MF NAV, depending on fund type and lender.

Q3. Can I get this loan without documents or income proof?
Yes. You only need PAN and access to your MF folio. It’s fully digital.

Q4. Is it safe to take a loan against mutual funds?
Yes, but you must monitor NAV. A sharp drop could lead to a margin call.

Q5. Where can I get the best LAMF deal in India?
Volt Money, Bajaj Finserv, and Investkraft currently offer the best LTV and low rates.

Apply today for an instant loan against mutual funds online — fast, trusted, and fully digital in 2025!