Loan & investment comparison
LAMF Calculator
See what changes when you redeem mutual fund units for a purchase or borrow against them and leave the fund invested.
At the selected horizon
Which path leaves more invested?
Enter your values to compare both paths.
—Where the money starts
PATH A · REDEEM
- Unrealised gain today
- —
- Units to sell to net the price
- —
- Capital gains tax today
- —
- Tax as % of the price
- —
- Fund left invested
- —
PATH B · BORROW
- Loan taken
- —
- Maximum at selected LTV
- —
- Fee per sanction incl. GST
- —
- Sanctions used
- —
- Total fees over the horizon
- —
Where the same money goes each month
| Monthly amount | A · Redeem | B · Borrow |
|---|---|---|
| Paid to the bank | ₹0 | — |
| Invested into the fund | — | — |
| Monthly share of sanction fees | ₹0 | — |
| Total monthly outflow | — | — |
| Annual amount invested | — | — |
Where you land at the end
| End of horizon | A · Redeem | B · Borrow |
|---|---|---|
| Starting fund grown | — | — |
| Value of monthly investing | — | — |
| Total fund value | — | — |
| Loan principal still owed | ₹0 | — |
| Fund cost basis | — | — |
| Unrealised gain fraction | — | — |
| Units sold to repay loan | ₹0 | — |
| Capital gains tax on forced sale | ₹0 | — |
| Repayment shortfall | ₹0 | — |
| Fund value you keep, net of shortfall | — | — |
How to read this lamf calculator
Compare the fund value left after redeeming units for a purchase with the value left after borrowing against the fund. Both paths use the same modeled monthly spending budget; the loan path includes fees, bank payments and any sale needed to clear principal at the end.
Worked example
With a ₹10,00,000 purchase, a ₹25,00,000 fund with ₹15,00,000 cost basis, 12% assumed annual return, 9.99% LAMF rate and three-year EMI, redeeming enough units to net the price requires about ₹10,36,184 and creates about ₹36,184 of modeled LTCG tax today.
Method and assumptions
Redemption solves gross sale minus tax on its proportional gain equals the purchase price. Both funds grow at the entered effective annual return; end-of-month investments use the same total monthly budget. The loan path then sells enough units to clear any remaining principal and the estimated tax on that sale.
The loan amount equals the purchase price and must fit the selected initial LTV cap. EMI uses a fixed nominal annual loan rate divided by 12, paid in arrears over the comparison horizon. Interest-only mode pays interest monthly, invests the unused EMI-equivalent amount and repays principal through a fund sale at the end. The fund return is a constant effective annual scenario, converted to a monthly rate; additions occur at each month end.
Each sanction, including renewals when the horizon exceeds the sanction tenure, incurs the entered fee plus GST. For the equal-monthly-budget comparison, total fees are spread evenly over the horizon; actual lenders may charge them upfront. The cash path invests the same monthly amount that the loan path spends on bank payments, fee share and contributions.
Tax uses a proportional average cost basis for units sold and the selected rate for both today's sale and any final forced sale. The entered LTCG exemption is assumed fully available in each separate sale year; short-term mode ignores it. This simplifies unit-specific holding periods, FIFO accounting, other gains, levies and changing law. The final fund values include unrealised gains; they are not full liquidation proceeds. Lender margin calls, rate changes, fund volatility and investment fees are excluded. Check your lender's terms and tax situation before relying on a decision.
Checks and limitations
Example and model checked on . These are software calculation checks, not a professional review of your finances. Displayed rupees may differ slightly from unrounded totals.
This is a mathematical model; it does not quote a specific financial product.
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