Your property is an asset that can help you in so many ways. One of the features of your property is that you can use it to arrange funds whenever you are under financial stress. Though many options are available in the market, one way to take a loan is by borrowing against your property.
You can use the funds for multiple needs, such as buying new property, renovating your house, or for any other purpose. The amount of loan you can borrow depends on your property value and your own eligibility as well.
Let’s look at some of the key features of a loan against property.
Read More: Now, Zomato Starts Layoffs Across Roles; To Reduce Workforce by 4%
Lower Interest Rate
A loan against property is a secured loan where the interest is typically lower as compared to unsecured loans. Besides, your credit score also helps you get a loan at a lower rate of interest.
Easy Documents and approval
If the legal title of your property is in place and all documents are genuine, getting a loan against the property becomes easy, and approvals are also faster. Since your property acts as collateral, banks are quick enough to disburse the funds without much delay in processing it.
Flexible repayment
A loan against property offers you a flexible repayment option. You can easily choose the tenure based on your income and repayment capacity. These loans can range as long as 15-20 years and even longer depending on the lender and your eligibility.
No Disturbance to Ownership
One of the interesting features of a loan against property is that your ownership remains with you. As long as you repay the loan on time, your ownership remains with the borrower. Only in case of default, the lender can auction the property. It also allows you to sell the property if you cannot repay the loan.
Read More: SBI is offering personal loans in just 4 clicks for THESE customers; Check details
You Can Pre-close the Loan
If you have borrowed the loan on floating interest rates, you can pre-close the loan without paying any penalty to the lender. You can do that whenever you have additional funds or you get money to fully repay your loan. You can also make partial payments to close the loan earlier than your loan tenure.
Besides these points, you must also compare the interest rates and EMIs and decide based on your eligibility and requirements. Try to negotiate the interest rates so that your EMIs are not too high, and your loan tenure is as short as possible. The table below helps you compare the interest rates of a 15-lakh loan for seven years and the EMIs. You can compare and take a call based on your needs.
Interest Rates & EMI on Loan Against Property
EMI on Loan Against Property of Rs 15 Lakh for 7-year Tenure
Compiled by BankBazaar.com
Note: Interest rate on Loan Against Residential Property (LAP) for all listed (BSE) Public & Pvt Banks considered for data compilation (excluding small finance banks) and including selective HFCs; Banks for which data is not available on their website are not considered. Data collected from respective bank’s/HFC’s website as on 15 Nov 2022. Banks and HFCs are listed in ascending order in their respective category on the basis of interest rate i.e. bank offering the lowest interest rate on LAP is placed at top and highest at the bottom. Lowest interest rate offered by the bank and HFCs on LAP is shown in the table (irrespective of loan amount and tenure). EMI is calculated on the basis of Interest rate mentioned in the table for Rs 15 Lac Loan with a tenure of 7 years (processing and other charges are assumed to be zero for EMI calculation); Interest mentioned in the table is indicative and may vary depending on the bank’s T&C.
