India is the land of diversity. Just as diverse the nature of the people living in this country is, so are their aspirations. And, loans of all forms are quite popular in India.
Quite often, when people decide to avail a loan, they become confused about which type of loan they should apply for. And why not, there is a loan for every purpose in India. But if you want to apply for a loan that provides you with funds for all your needs instead of a specific purpose, then you should opt for a loan against property.
Perhaps the biggest benefit of a loan against property, which also makes it one of the most popular loan options in India, is the flexibility in the usage of funds.
The following are the benefits of a loan against property that should prompt you to go for a property loan for whatever your needs are.
1. Spend the Funds on Anything
Your requirements may be varied. Not to worry, a loan against property can fulfil all your needs. You may mortgage your existing property to purchase or construct a new property in a prime locality. You can also use the funds to renovate or decorate the mortgaged property. If you have a dream of owning a motor vehicle, the loan against property can help you accomplish the dream. If you are into business and need urgent funds to expand your business or require working capital, the loan against propertycan ensure that your business never suffers due to the lack of money. Not only this, but a loan against property can also rescue you from a medical emergency.
2. Attractive Interest Rates
Because you are mortgaging an asset to avail loan against property, lenders go the extra mile to offer you the lowest possible interest rate on loan. And, a lower interest rate means lower EMIs and higher savings. Practically no other loan offers the same kind of advantage as a property loan. Sometimes, by opting for a short tenure, you can make the deal even sweeter. Lenders usually reserve the best rates for borrowers who choose a shorter term.
3. Long Loan Tenure
loan against property lowest interest rate is also admired for the high loan term it offers. Generally, you may get up to twenty years for repayment. The higher loan term you select, the lower your EMIs will be. However, the interest rate for a long-term loan might be substantially higher than the short-term loan against property. An advantage of paying your loan dues early is that it makes you eligible to apply for a new loan sooner.
4. Capitalise Your Immovable Asset
Perhaps the biggest advantage of a loan against property is that it enables you to make your property work for you. Generally, the property is considered as an unproductive asset, which means it does not generate revenue for you in the short-term unless you plan to sell it. A loan against property utilises your idle and immovable asset to give you money. And, the property legally remains yours throughout the loan term. Although, if you default on the payments, the lender might serve you with a legal notice.
5. Simple Eligibility Criteria
One of the most significant advantages of a loan against property is that the eligibility criteria to apply for the loan is extremely simple. You can apply for the loan if you are above 18 and below 65. Usually, the lender sets an income threshold for salaried professionals and an annual profit turnover for business persons. If you meet the lender’s set criteria, you are eligible to avail the loan. Additionally, lenders may relax the eligibility criteria if your credit score is above 800.
6. Minimal Documentation
Just like the simple eligibility criteria, loan against property needs minimal documentation. You need to keep documents like age proof, address proof, identity proof, income statement, bank statement, property documents, along with the loan processing fee cheque while applying for the loan. Many reputed lenders also offer the facility to upload the documents online, which can save you precious time.
Various lenders are vying for your attention. Ensure that you look at all the factors like service quality, loan terms, application formalities, etc. before applying for the loan against property. You may also get in touch with PNB Housing Finance for getting the industry’s best and lowest loan against property interest rates.