Don’t have sufficient funds in your account and you need money for an emergency?
You can turn to your bank for an overdraft facility.
An overdraft facility is a short-term credit line through which an account holder can borrow up to a certain sum once the account balance reaches zero.
You can get this against your:
1. Salary
2. FD
3. Equity/ Mutual Funds
4. Insurance Policy
5. House
The interest charged & the credit limit usually vary based on the asset offered as collateral.
Plus, you have to pay interest on the amount you actually withdraw & the interest is calculated daily!
But banks won’t give the money free of cost, right?
So, some banks charge a one-time processing fee to avail of this facility.
And it has to be renewed annually for which banks charge a renewal fee!!
It DEPENDS from BANK TO BANK and against which asset you are taking an OD!
So do check before you avail this facility!
If they costs are not that high, then you can consider optiong for it
Because you can withdraw & repay it as and when you want.!!
The banks do not ask for repayment through EMIs. You can do it partly or lumpsum as you wish!
But remember, it is a form of debt you owe to the bank that needs to be returned along with interest charges within stipulated time. SO only and only use it in cases of emergencies!!
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@bikermustafa90
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