Most of us, sometime face the requirements of raising sufficient funds to meet a crisis. A well written plan can solve this issue to a great extend. In this article you can find some best possible methods to raise fund to meet such crisis.
Below are the channels, % of interest and the time taken
1. Employer Loan / Subsidy % interest is usually low and Time taken is variable
2. Overdraft against FD, Around 2% over FD rate and time taken is 8-10 days
3. Loan against Fixed Deposit , around 2% over FD rate and time taken is 1-2 days
4. Loan against shares, MF’s and financial securities, 12-13% interest and time taken is usually 3-4 days5. Loan against property, Around 12-15% and usually 12-15 days
6. Loan against gold and Jewelry, around 12-13% and Money will receive on the spot
7. Loan against insurance policies, around 9% for insurers and 12-14% for banks and time taken around 4-5 days
8. Personal Loan – 18-25% – 4 to 5 Days
9. Credit card – Around 40% p.a. – On the spot
Some points to remember:Money lenders are the best source for emergency but, they offer unsecured credit and the interest rate is a killer 50 to 60%.Credit card have 3% interest but, there will not be any credit period available. Due to such, interest would be charged from the day one and on daily basis.Personal Loan will put you an interest rate of 18-25% and any default to repay lead you to huge bad debt.Sales of an asset is required ample time to receive right price. Showing emergency can lead to possible lose. Borrowing against asset is much better than selling an asset.Overdraft facility is known as one of the cheapest way to access money. It give almost instant access to money without any extra paper work. Charges are vary.Loans on insurance policies, securities and financial assets could be vary depends on banks. Finding a right lender is a time taking process.
In the above context, a person should have a well written plan on how he will raise money if an emergency arises. Always have multiple channels for a redundancy from failure.