Loan Against Security Calculator
Calculate the loan amount you can avail against securities based on LTV ratio.
Eligible Loan Amount
₹5,00,000
Breakdown
Monthly EMI
₹10,138
Total Interest
₹1,08,292
Total Payment
₹6,08,292
Schedule
| Year | Principal Paid | Interest Paid | Balance |
|---|---|---|---|
| 1 | ₹84,720 | ₹36,938 | ₹4,15,280 |
| 2 | ₹91,752 | ₹29,907 | ₹3,23,528 |
| 3 | ₹99,367 | ₹22,291 | ₹2,24,161 |
| 4 | ₹1,07,615 | ₹14,044 | ₹1,16,547 |
| 5 | ₹1,16,547 | ₹5,112 | ₹0 |
What is Loan Against Security?
A Loan Against Security (LAS) allows you to borrow funds by pledging financial assets such as shares, mutual funds, bonds, or insurance policies as collateral. Instead of selling your investments, you temporarily pledge them and receive a loan based on a percentage of their market value.
This percentage is called Loan-to-Value (LTV). LAS uses a reducing balance method, which means you pay interest only on whatever you still owe, not the original amount throughout the entire loan.
How Loan Against Security Works
Lenders won't hand over cash equal to your full portfolio value — they need a buffer in case markets tumble. For example, if you own shares worth ₹1,00,000 and your lender offers a 50% LTV, you can borrow ₹50,000 while your shares stay pledged.
Because the lender has your investments as collateral, LAS typically charges much lower interest than personal loans or credit cards.
Reducing Balance Interest
Interest charged only on outstanding principal, not the original amount
Lower Interest Rates
Typically cheaper than personal loans or credit cards due to collateral backing
Retain Ownership
Your investments stay pledged — you still benefit from any market appreciation
Calculation Method
Formula:
Where:
- Security Value = Current market value of pledged assets
- LTV = Loan-to-Value ratio set by the lender
- EMI = Calculated using standard reducing balance formula
Assumptions:
- ✓ Reducing balance interest
- ✓ Fixed interest rate
- ✓ Monthly EMI payments
Key Benefits
No Need to Sell
Access funds without liquidating your investments
Lower Rates
Secured loans enjoy lower interest rates than unsecured options
Market Upside
Continue to benefit from appreciation in pledged securities
Quick Disbursement
Faster processing compared to traditional loans
Important Disclaimer
This is general educational explanation only. This is not financial advice, and this is not a recommendation to take out a loan against security.
All example numbers used here are for illustration only. Interest rates, LTV ratios, eligibility rules and margin call terms vary widely between lenders.
Always read and fully understand the margin call rules of any lender before you sign anything. If you would not be able to come up with additional cash or collateral in the event of a 30% market crash, you should not use this product.