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Using debt funds collateral for lower risk borrowing
Debt fund collateral reduces lender risk, often resulting in better borrowing terms.
Debt mutual funds experience lower price volatility compared to equity funds, allowing banks to offer higher loan-to-value ratios, sometimes up to 85%. Interest rates are also lower, often near 9.5%, reflecting reduced lender risk. For conservative investors, this structure provides a safe and cost-effective borrowing route. It enables liquidity access while minimizing market-related collateral fluctuations and financial stress. Apply Now