Therefore, the best way to arrange finance would be avail loans. These are the best options to fight against cash crunch. Also, they are always easy and convenient to get and you have multiple options as well.
But personal loan or pre-approved loan already have exorbitant interest rates and very less tenure for repayment. In fact, it’s a big gamble to take personal loans. The best way to manage finance would be turned towards the property which you have constructed in your life. Yes! Loan against property could be of great help when the loan required is higher than what could be availed through a personal loan. LAP is considered as the cheapest secured loans with low monthly installments.
Loan against Property is a loan wherein you keep your construct property whether commercial or residential as a collateral or security to the bank or non-banking finance companies and borrow the money against it.
These days leading finance companies are offering exceptionally good and low-interest rates for the customer along with flexible repayment strategies. All you need to do is apply for a loan against property with property documentation, good credit score and income source and banks or non-banking finance companies will evaluate the parameters and offer you a particular eligible amount.
Let’s take a look at few of the advantages of LAP in India:
To avail LAP you don’t to go through the hassles like a new home loan. Since the lenders already have the property quote in hand they can sanction a particular loan amount based on property value, its age, your credit score and income. Thus, you can get a loan within no time if the property worth has been proven.
2. Low-Interest Rates
The interest rates of LAP is competitively low than a personal or traditional loan. The interest rate of LAP generally varies from 8.50% to 13% whereas a personal loan could pitch anywhere between 11% to 24% pa. This could lead to a huge blow to your finances in future.
3. Use for Multiple Purpose
As long as you don’t use the money to harm anyone or indulge in criminal activities, LAP could be availed for varied reasons such as business expansion, house renovation, children higher education, bearing marriage expenses of son/daughter, any medical emergency, etc. Once you have the loan disbursed to your account you can use it as per your wish.
4. Long Tenure
The personal or traditional loan can offer you a maximum tenure of 5 years which is too short. But loan against property offers you a healthy time period from 10 to 15 years for repayment. Since the loan amount is high so would be the tenure.
5. You are the owner
The biggest mistake of the consumer is they think mortgage loan means you’re transferring the ownership to lenders. However, it is not as such. You continue to be the owner of the property and use it for any purpose such as living or rent. It’s only the papers that are kept as collateral with banks or private firms to have some assurance of the loan repayment.
6. Amount Flexibility
You can get a loan up to 60% to 70% of the net market value of your property. So it’s up to you how much you want the loan amount. It’s advisable take loan based on your income source and risk appetite.
The low-interest rates, longer tenure, and flexible repayment options make Loan against property the ideal financial solutions for people searching finance while in contingencies.