An Overdraft facility may be said to be a type of promised modern loan facility granted by a bank to its existing customers against their residential or a commercial property, which the customer can use whenever required irrespective of its date of approval.
A person does not need getting a loan approved each time he requires funds to suffice his short term needs. Also, it’s not always possible to get a loan approved as instantly as one is requiring. Being the proud owner of a property brings along the privilege of using its potential as a financial assistance and getting an assured helping hand whenever required. This more facilitating loan alternative is dubbed as an Overdraft.
The bank extending an overdraft facility sets a certain credit limit for a customer, on the basis of the evaluation of his property following which the customer can borrow required amounts in different sets summing up to not more than the overdraft’s set credit limit. The Overdraft limit always remains the same and once a customer repays the borrowed amount of money, the available overdraft credit limit becomes equivalent to the total credit limit. The interest on an OD is calculated on a daily basis and that too only on the outstanding balance.
A commercial as well as residential property is acceptable as collateral for approving an Overdraft against property.
Applying for an OD facility is quite similar to applying for any loan. The required set of documents is almost the same; all an applicant has to provide in extra is the collateral against which the bank will approve the facility.
Speak to one of our Loan Specialists to begin the customer needs assessment.