By Chaitali Dutta

How should I apply for a loan against my mutual funds? Will the interest rate be lower than that of a personal loan?
—Arvind Iyer

Yes, you may look for a loan against securities like your mutual funds. However, the loan amount will be about 50% of the value of the equity schemes and 80% of the value of debt schemes. The effective interest rate will be lower than a personal loan.

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Last year I took education loan from Kaveri Grameen Bank for my son to study abroad. Can I shift the loan to another bank with lower interest rate?
—Subash Arora

Yes, it is possible to transfer this loan and shift to a lower-cost service provider. Compare the interest rates and go with a reputed financial institution.

I had taken a home loan five years ago and pay the EMI regularly. I want to sell the property and buy another with a loan. Should I pre-pay the existing loan? In that case, my down payment for the new property will be much lower. What should I do?
—S K Dua

If a property is to be sold, the loan is paid off from the sale proceeds itself. Only the balance amount will be received in your account. You may use those funds for down payment for the new house.

I am working at a public sector bank from where I have availed one housing loan at concessional rate. Now, I am moving to another PSU bank. My bank is not allowing me to continue my loan even at a commercial rate. How can I continue my loan?
—Ramesh Yadav

In the case of employee concession loans, the existing loan has to be repaid in full, while leaving the institution. You may have to look for a stop-gap arrangement to repay the loan.

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I take coaching classes and receive most of the payments in cash. I am planning to take a home loan. What documents should I have before I apply for a loan of Rs 20 lakh?
—Name withheld

The income has to be reflected in your ITR. Start depositing the cash in your bank account and pay the necessary income tax. You also need to have a history of three years of ITR for sanction of a home loan.

The writer is founder, AZUKE Personal Finance Advisory.