Life is all about dreams. But often inability to access funds
when we need it the most acts as a hindrance to the realisation of our dreams.
Not anymore, as a loan against property is designed to meet shortage of money
in the shortest time possible.
Scroll through this article to know the eligibility criteria of loan
against property and where you can find the best interest rates that can take care of
all your needs without the EMIs acting as a deterrent.
Uses of a Loan Against Property
Loans against property are power-packed
loans with attractive interest rates
and simple eligibility criteria.
You may use the funds to buy a motor vehicle, spend on an international
vacation, construct a house, or pay off existing debt. Some borrowers use it to
buy machinery for business or for setting up a new business. There is no
limitation on using the loan amount for any purpose you wish to.
Loan Against Property Interest Rates
Loan
against property interest rate is of two types - fixed and floating.
A fixed rate remains the same throughout the tenure of the loan.
It is generally a few basis points higher than the prevailing floating rate of
interest.
A floating rate of interest changes depending on market
conditions and government regulations. The floating rate of interest, at
present, is between 10.25% and 11%.
Loan Against Property Eligibility
The eligibility
criteria of a loan against property are
simple. Go through the following checklist to get an idea.
1. Your CIBIL score should be above 700.
2. Your age should not cross 65, on the date of loan maturity.
3. You should have ownership rights to the property you wish to
mortgage.
4. Your income should be above a threshold limit set by the
lender.
Once you satisfy these simple criteria, the next step is
document submission.
Similar Read: Do lenders offer Loan Against Property schemes for Non-resident Indians?
Documents You Should Submit to Get the Best Loan Against
Property Interest Rates
To avail a loan against
property that gives you the best interest
rates, you should keep the following documents at your disposal.
a. Filled application form and the latest photograph of the
borrower(s)
b. Age proof
c. Identity proof
d. Address proof
e. Income proof, in the form of salary statement or salary slips
(for salaried employees)
f. Business profile and Profit & Loss statement, attested by
a Chartered Accountant (for self-employed professionals))
g. Form-16
h. 2-years' Income Tax returns
i. Property documents
j. Any other document as requested by the lender.
You can stay one step ahead in the race to get a loan against
property by keeping the documents in place.
Other Factors You Should Keep in Mind
1. Loan Repayment
Tenure
Although the maximum loan repayment tenure is generally 20
years, many borrowers choose to repay the loan much earlier. Choosing a shorter
tenure reduces the loan against
property interest rate, and the borrowers become eligible to apply for a
fresh loan.
2. Downpayment
As per RBI's directive, borrowers need to pay 20% of the loan
amount as a downpayment. However, you may choose to pay a higher amount, as
that would bring down your monthly interest outflow.
Conclusion
The simplicity of loan
against property's eligibility
criteria makes it a popular choice for millions of borrowers. Compare a few
national-level lenders and choose the one that offers you the best interest rates.
Read More: What are the Different Forms of Loans Offered under Loan against Property?
Cumulative Fixed Deposits and Non-Cumulative Fixed Deposits Which One Is Good for Senior Citizen
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