Essentials for Loan Against Property

July 15,2017

When it comes to property, people usually buy in order to invest their money so that they can have better returns in the future. That money which comes out of the premium is especially handy when it comes to emergency. Whatever the reason might be, it is good to invest in property because usually the returns are much high and there it can be used for several purposes.

That property can also be used as a collateral for a loan. Here we are going to talk about pointers which you have to keep in mind before you go for a Loan Against Property.

LAP is cheaper than getting a personal loan. Since it is a collateral, there are a number of interest savings which come with this kind of loan. The only thing you have to keep in mind is that the rates offered to you should be lesser than that of a personal loan.
Another thing which you have to keep in mind while availing LAP is that there should be no discrepancies in the property. You should also keep in mind that the property is not disputed and all the owners and the rightful owners are in agreement.
One very important thing which you have to keep in mind is that LAP is a long-term loan. Just to get a measure of things, the tenure of a personal loan is up to five years, whereas the tenure for LAP is anything between eight to 10 years. One of the things that the banks take into consideration is the age of the applicant, so when you are going for LAP, allow the younger applicant to the loan, if the property is owned by more than one person.
Make sure that that your CIBIL score is clean and that there is nothing negative in it. There should be nothing in your CIBIL score that should even suggest that you don’t have the ability to repay the loan.
When it comes to LAP, you should know that the amount which is disbursed to you is usually 70% of your property value. So before you apply for a loan, make sure you know the true value of your property. Get your property appraised in order to know the true value of your property.