Life’s milestones, like weddings, education, a foreign vacation, etc, are memorable events, etched in the memory forever. However, these occasions require significant finances. People want to fund these events with minimum financial stress, and a residential or commercial property they own can be of immense help at such times.
They can conveniently apply for a loan against property in India and arrange the required funds when they need them the most. Applying for a LAP helps secure funds during an emergency while keeping the process hassle-free. It is a secured loan that allows individuals to harness their property’s value and meet their expenditures. This way, a property loan can help people fulfill their goals and dreams affordably and conveniently.
Expenses One Can Cover with a Property Loan
Want to know how a property loan can help achieve dreams? Look at the wide variety of expenses one can cover using this loan type.
- Business Expansion: Many people might want to set up a new business or expand the existing one. It is a fact that companies require funds to keep things going. A property loan comes in handy by giving them the extra cash needed for their business growth. From launching a new product line to upgrading equipment, funds from a property loan are beneficial for a business.
- Higher Education: Studying in a reputed educational institution needs substantial expenses; shifting to a new place, travelling overseas, paying admission fees, buying a new laptop, etc. A property loan can help finance those expenses and support an individual to get the education they desire.
- Wedding Expenses: Indian weddings are extravagant affairs that entail considerable expenses for both families. From booking the venue to hiring the caterer and planning for a honeymoon, a property loan offers an end-to-end financial solution to manage these expenses.
- Medical Procedures: Handling a medical emergency is a daunting task amidst the rising healthcare costs. Most health insurance plans do not cover elective medical procedures like IVF, childbirth, cosmetic surgery, and dental implants. To cover those medical expenses, a property loan is the best choice, thanks to its fast approval and quick disbursal.
- Foreign Vacation: Those who want to travel the world can do so without stress by taking a loan against their property. It provides ultimate financial support to families that can manage holiday expenses with a loan. They do not need to cover the costs from their savings. They may use a property loan calculator to borrow the money they need and cover the costs.
- Debt Consolidation: Taking a property loan to consolidate existing debts leaves the borrower with a single EMI payment each month. A loan against property provides a substantial amount to use for a long time. It is an excellent opportunity to convert all high-interest loans to a single lower-interest loan.
Beneficial Features of a Loan Against Property
- Loan Amount: Many lenders lend up to 70% of the property’s market value as a loan.
- Low-Interest Rates: Secured loans like property loans have lower interest rates that keep the loan cost low.
- Longer Repayment: Property loans do not force a borrower to repay the loan within a few months. They have much longer repayment tenures than other loan types.
- Easy Eligibility: Since the borrower is pledging property to borrow a loan, the eligibility conditions are easier to meet. Documentation requirements are also minimal, making the loan process easier and faster.
Benefits of Taking a Loan Against Property
Those who apply for a loan against property in India enjoy numerous benefits to meet their big-ticket expenses. Below are a few significant benefits the borrowers may enjoy.
- Convenient Repayment: One may apply for a loan against property for several years. A longer repayment term distributes the borrowed amount into several EMIs, resulting in a lower EMI amount to pay each month. Use a property loan calculator to calculate the EMIs and repay affordably without stressing the monthly budget.
- Low-Interest Rates: Since a property loan is secured, its interest rates are much lower than collateral-free loans like personal loans.
- Low or No Pre-payment Charges: According to RBI regulations, borrowers with a floating interest rate do not need to pay foreclosure or pre-payment charges.
Those who require large amounts of money for personal or business reasons may take a loan against their property. Lower interest rates and more manageable EMI payments make the loan process extremely quick and straightforward for borrowers. However, since a loan against property in India is a long-term commitment, comparing lenders and making an informed decision is crucial for the borrowers.