Easy Tips To Getting Mortgage Loan Against Your Property

Mortgage loan against property has seen a stable and upward growth. And the segment is expected to see even more appreciation in the coming days. This is a type of secured loan in which you, as a borrower, can mortgage your home or any other property and take out a loan against it. The amount you can borrow depends upon the value of your property. You can get, on an average, 40 to 60 percent of the value of the property, as loan.  

Mortgage Loan Against Your Property

Here are some easy tips to get the most out of your property deal.

Tips To Follow While Taking Out A Loan Against A Property

Life is unpredictable. You may have to face an emergency at any point of time. Most emergencies associate financial crisis. When you need a large amount of money, a loan against property (LAP) would be the best.

Let’s have a look at the following pointers before you sign on the agreement.

  • Don’t Borrow Beyond Your Capacity

don't borrow beyond capacity

Unless you have the facility to repay the loan through Easy Monthly Installments (EMIs) for many years to come, you shouldn’t borrow any amount beyond your financial capacity. The basic rule of thumb suggests that the monthly EMI for a loan must not surpass 60 to 65 percent of the borrower’s net taxable income. Most nationalized as well as private banks offer LAP for an average of 40 to 60 percent of the property value. Make sure you have required financial capability to pay off the amount you are borrowing. If the EMI amount eats up a good chunk of your monthly income, you may have to compromise on other financial targets like retirement plans or children’s education.

  • Choose A Shorter Duration

shorter duration

LAPs are often available with tenure of a maximum of 15 years and that, in most cases, makes it really tempting to go for a lower EMI. But in long run, it may require you to pay much more in interest than you would have repaid for a loan with shorter duration. Even if it is not presently possible for you to take a loan with lower tenure, you can ask the bank to increase the EMI amount each year in line with you increasing income. The shorter your loan tenure is, the less loan burden you’ll have.

  • Make Payments On Time

make payment on time

Apart from non-payment penalties, untimely payment can negatively affect your credit score. Besides, it can also leave you with a hefty interest on the unpaid amount. And that can diminish your likelihood to getting another loan. Be disciplined and punctual in repaying the loan.

  • Buy Insurance With Big Loans

buy insurance big loans

If you are going to take a big property mortgage loan, it is highly recommended that you get adequate insurance coverage. In case of a mishap, this would reduce the burden on your family. It is likely that your bank will provide you with a term cover equaling to the unpaid amount. However, you can also opt for a regular term plan.

These are just a few of many useful tips you may follow to ensure getting the best loan against property deal and avail it easily from www.bazaarmoney.com/home-property-mortgage-loan-funding-india.php


5 Queries About Home Property Mortgage Loan Funding Has Been Answered

Whether you are willing to apply for a home property mortgage loan to meet your expenditure for marriage, healthcare or education, this fund comes really handy for a wide variety of speculative purposes. The rate of interest is generally dependent on the amount you have borrowed and the time span. Though the advantages one can reap by obtaining a mortgage loan is numerous, there are people who tend to stay away from those. One of the main reasons being there are few queries that crop up in one’s mind when we talk about property mortgage loan.

Home Property Mortgage Loan Funding in india

Availing Home Property Mortgage Loan Funding In India? Your Common Queries Has Been Answered

  • “How Does It Differ From Home Loan?”

Though they sound similar, the funding options are totally different. The mortgage is a type of loan in which your home property is used as collateral. You will be entering into an agreement with the loan provider under which you will have to repay the borrowed amount in small installments within the specified time period. You can use the amount for a wide variety of purposes. The Home Loan is the amount you borrow only to buy a property.

  • “Do I Need To Specify The Purpose?”

Irrespective of you applying for the loan through any banking or non-banking institution, specifying the purpose for which you have applied for the loan won’t be necessary. All you need to do is provide them an undertaking that the amount won’t be used for any illegal purposes. Though there are few banks who might ask you to specify the purpose, it is generally dependent on the loan amount.

  • “Are There Any Taxation Aspects?”

If any salaried person is applying for the fund, they don’t need to pay any amount as tax incentive on the EMI. But if you are a businessman, claiming the tax deduction on the total loan amount isn’t a daunting task if you can prove your loan provider than the amount has solely been used to enhance your business.

  • “Can I Pre-Pay The Amount?”

If you are availing home property mortgage loan funding in India you can re-pay the amount before the scheduled time span. According to the recent RBI (Reserve Bank of India) directive, it is illegal for commercial banks to demand any amount as foreclosure charge on floating rate term loans sanctioned to individual borrowers.

property mortgage loan

  • “What Is The Maximum Amount I Can Borrow?”

There is no fixed quantum for such loans but around 70% of the market value of the collateral property is treated as the sanctioned amount. The other criterion which determines the loan amount is job stability, income, investment, spouse’s heath condition, your age, and number of dependents, among others.

Resolving the queries surrounding home property mortgage loan is a must so that every Indian can make the most of the funding. So apply for your mortgage loan at www.bazaarmoney.com/home-property-mortgage-loan-funding-india.php

Opting For Home Property Mortgage Loan Funding In India? 4 Quick Tips For You

Though many express the desire of undertaking a home property mortgage loan, not all can get that loan sanctioned. Moreover, there are so many companies eager to offer you loans at the minimum interest rate, it’s only getting harder for you to choose the ideal credit provider. But there’s simply nothing to worry about. There are numerous companies in India who offer you advisory services regarding these credits.

If you want to undertake a mortgage loan but don’t want to regret it later, prepare yourself before applying for it. Try gathering adequate knowledge and understanding of how these home loans work so that you don’t have to face any unexpected situation later. Companies offering you advice about Home Property mortgage loan funding in India provide you with tips to help you take a wise decision.


Few Tips Before Applying For Home Property Mortgage Loan Funding In India

  • Don’t Treat Mortgages Like Commodities

    Since a mortgage is not a commodity, so considering only the rate isn’t a wise thing to do. In fact, doing so can actually make you disappointed from the moment you start looking for a credit provider. Try finding a trusted partner who can make complex transactions easier for you by offering responsive support and honest advice throughout the credit process.

  • Stay Way From Interest-Only Loans

    The ‘interest-only’ loan is only advisable for borrowers who are planning to move within a short period of time or is undertaking the credit as a construction loan or short-term bridge. Paying only the interest will prevent you from building up any equity or ownership in your property.

  • Choose One Whose Fees Are Reasonable

    Before applying, make sure you can afford the loan amount. It is vital for you to find out the exact amount the loan will cost you, as all fees are not avoidable. Try negotiating or getting rid of those ‘junk fees’. Getting a reliable estimate statement from your credit provider will let you know your entire expected fees.

  • Stay Away From Adjustable Rate Loans

    Many lenders offer adjustable rate loans because borrowers get easily attracted towards those. This is mainly because the fixed rate is higher than the advertised rate. It is advisable to opt for it only if you are sure that the interest rate won’t get higher than the current interest rate.

Though the tips stated above is not the ultimate tips for you as a borrower but they will definitely help you choose the ideal loan provider.