taking a loan against property

Why Loan against Property is the Best Financial Decision during Emergencies?

Mortgage loans are extremely resourceful entities, provided you require quick financial support without exorbitant interest rates. Amid the diverse set of mortgage loans, a LAP is probably the most rewarding option to rely on, based on the usable amount, speed of approval, and competitive interest rates.

Here are some of the reasons why loan against property (https://www.fullertonindia.com/loan-against-property.aspx) is a prudent choice for funding businesses or attending to emergencies:

  • Sizable valuation

LAPs allow you to get a decent line of credit as credible lenders offer a true assessment of the concerned establishment. While the business and personal loans have funding limitations, you can procure a sizable amount as LAP, amounting to almost 3.5cr for self-employed individuals.

  • Flexible Tenure

LAPs, if and when offered by credible lenders, allow you to be flexible with the tenure. Most importantly, you can use the same as a long-tenure mortgage loan provided you are willing to repay the same, slowly.

  • Supports a wide range of properties

If you have made up your mind regarding a LAP, you can use a wide range of establishments for procuring a decent line of credit. Be it a commercial or a residential establishment, loans against properties are compatible with diverse assets. 

  • Affordable

LAPs are extremely affordable considered the secured nature of the same. This means that the loan against property interest rate is often lower than a standard personal or business loan. Moreover, this attribute ensures that you can extend the tenure without having to worry about the accruing interest. 

These features qualify LAP as the best form of financial support, especially during emergencies. 

Must Read: 5 Types Of Mortgage Loans: Which One Is Best For You?

Are There Any Benefits Of Taking A Loan Against Property?

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A property is a financial asset. But, for most people, it is also an emotional investment. However, many people are hesitant of using this asset to get a loan.

But, if you need cash, then this is one option you must explore. Here, we have listed some of the major benefits of taking a loan against property to help you make an informed choice.

  1. You get a high loan amount – Most properties are high-value and you can get up to 70% of the value as the loan amount. It means you can meet heavy expenditures like paying college fees, wedding expense or financing a new business.
  2. You do not lose ownership of the property – One of the biggest advantages of this loan is that you can continue to enjoy the property for self-use. Additionally, you remain the owner of the property. Do remember that if you miss your EMIs regularly and the lender calculates your inability to repay the loan, they can sell the property to recover dues.
  3. The interest rate is lower when compared to other loans – Since you are pledging an asset to the lending institution, the interest rate is lower when compared to personal loans. The loan against property interest rate starts as low as 9% and goes up to 24%. But, the actual interest rates depend on a lot of factors as listed on the lender’s website.  

You are putting up a much-valued asset as collateral. So, you need to do your due diligence about the lender apart from researching the interest rate to knowing the loan against property documents required to make the right decision.

Additional Read: How to Ensure Maximum Savings on Loan against Property?