Points to Check Before Applying for a Loan Against Property

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mortgageloan
mortgageloan

Financial decisions should be made after genuinely thinking about them and researching for ways to ensure you get the best returns. The choice you make today should not act as a hindrance for future plans.

For example, the loans that you take today should not be a burden in the future, like when you plan your child’s education or go through a medical emergency.

Loan Against Property

If you need a large amount of money at affordable rates, apply for an instant loan against property. It is inarguably the best choice. While salary-earning individuals can secure a loan up to Rs.1 crore, self-employed people can get up to Rs.3.5 crore. However, just like any other financial decision, you should keep a few points in mind while applying for a loan against property.

Points to Keep in Mind while Applying for a Loan Against Property:

  • Secured Loan

This type of loan is secured, as you need to pledge a personal residential or commercial property to acquire the loan. The amount that lending institution provide following the value of the asset you commit as security.

You need to be aware that lending institution has tiring procedures and are extremely strict about their loans and payments. While you need to worry about the vast paperwork done before you get the loan, you need to make sure you make the payments on time as well. Failing to do so might lead you to be blessed by unwanted visits from lending institution officials at your home.

  • Long-Term Loans

Loans against property are long-term loans and need to be paid over more extended periods compared to other loans. While this acts as boon for the majority of the people, some aren’t able to gain the same benefits.

Such loans should be applied for only after extensive planning and thinking about what you’ll be doing during the time you’re expected to make the repayments. People that can’t ensure a natural flow of income, be it through salary or business, shouldn’t apply for such loans.

You might be able to afford the EMIs of the loan now, but might not be able to do so in future as well. Calculate the EMIs you’ll have to pay back using the numerous loan against property calculators available online to ensure you can afford the loan.

  • Smaller EMIs

Due to the availability of the option to pay over a long time, such loans often come with quite a small amount of monthly EMIs. It is the perfect choice for anyone that isn’t comfortable with paying huge installments every month.

If your salary doesn’t permit you to pay huge EMIs, here is the solution to your problem.

All Types of Property Accepted

There isn’t a specific type of property that needs to be pledged to avail a loan against property. All kinds of properties like residential, commercial, land, and, even, under-construction properties are accepted as collateral.

The lending institution should find the property mortgaged valuable enough to trust you with the loan amount.

Numerous Offers

Thanks to its security feature, all lending institutions compete to offer the most competitive loan amounts for the same property. There are tons of such offers that roll in regularly in your emails.

However, you need to do an extensive amount of research before you apply for a loan at a lending institution. The most important thing is to compare the loan against property interest rate of different financial institutions. Furthermore, a bit of extra thinking while you’re deciding which property to mortgage as well.

Make sure to find the best deal and a trustworthy lending institution before you pledge your property. You also need to consider your ability to repay the amount over the promised duration, as failure to do so will lead to the loss of the asset you pledge as security.

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