Discover Hidden Benefits of Interest Rates on Loan Against Property this Festival

Festival season is just around the corner, and with it comes the joy of buying new things. From new clothes and appliances to how you celebrate this season, everything needs to be perfect.

However, fulfilling all your wishes and dreams during this festive season can put a considerable financial burden on you. You may have to dip into your savings or borrow from relatives and friends to pay for everything.

But did you know that there is a smart way to go about it? Opting for a loan against property can help you get the best of both worlds: enjoy the festive season without compromising on your savings.

A Loan Against Property is a secured loan that allows you to borrow money from a bank or financial institution by keeping your property as collateral. It can be a residential property or a commercial property that belongs to you, and you can get a loan amount equivalent to a percentage of the market value of your property. Generally, the market values vary from bank to bank. So, it is advised to compare every bank’s percentage value before applying for a loan against property.

What are the hidden benefits of the best loan against property this Festival?

1. Low-interest rates on Loan Against Property: Loan against property is a secured loan which offers lower interest rates than an unsecured personal loan or a credit card. Generally, the interest rates on loan against property vary from bank to bank, but they are often lower than those of a personal loan or a credit card. This way, you get a chance to pay back the loan comfortably without putting a load on your savings.

2. Longer repayment tenure on Loan Against Property: Another major benefit of a loan against property is the longer repayment tenure. It is usually up to 20 years, which means you can enjoy the festive season and pay back the loan comfortably over an extended period. This way, you don’t have to worry about debt burdening you in the long run.

3. No Prepayment Charges on Loan Against Property: Lenders usually do not charge prepayment fees on a loan against property, which means you can repay the loan before the tenure ends without any penalty or additional fee. This flexibility will help you save significant interest and clear your debt before time with no additional charges.

4. Easy process: Your Property loan process is easy, straightforward, and hassle-free. All you need to do is submit your property-related documents and meet the eligibility criteria. A lender will assess your application’s merit on the basis of the property’s value, your repayment capacity, and your creditworthiness.

5. High loan amount: The loan amount you can get through a loan against property is significantly higher than personal loans. You can get up to 70% of the property value in the form of a loan. This high loan amount ensures that you will be able to fulfill all your financial needs this festive season without having to borrow from someone else or dipping into your savings account.

6. Tax benefits: Loan against property borrowers can claim tax benefits on the interest paid on their loan. You can claim a deduction of up to Rs. 2 lakh under Section 24 of the Income Tax Act. This means that the tax paid on interest payment can reduce your tax liability and save you some significant money.

Documents required for loan against property:

Before you apply for a loan against your property, you must know the documentation that the lender may require from you:

● Identity proofs like Pan Card, Aadhar card, Passport, Voters ID, etc.

● Address proof like electricity bill, gas bill, water bill, telephone bill, etc.

● Proof of Ownership like Sale deed, title deed, property tax receipt, etc.

● Financial Records like IT returns, bank statements, salary slips, etc.

● Employment proof and business viability proof (if applicable)

Eligibility for a loan against property:

To be eligible for a loan against property, you must fulfill the following criteria:

● Age: You should be between 24-70 years.

● Income eligibility: You should have a minimum income of Rs. 3 lakhs per annum and should be able to provide proof of income.

● Property eligibility: You should own a residential or commercial property.

● Credit score: A good credit score can increase your chances of getting a loan against property approved.

Loan against property calculator:

Before you apply for a loan against property, you can use the loan against property calculator India to get an estimate of the loan tenor, interest rate, EMI, and overall cost of the loan. It can help you get a realistic idea of your repayment capacity and help you make informed financial decisions.

In conclusion, a loan against property is undoubtedly one of the best financing options during the festive season. It enables you to fulfill all your financial needs without compromising on your savings, and provides you access to a large amount of credit at lower interest rates.

However, before you apply for a loan against property, make sure you do your due diligence, compare interest rates, check your eligibility criteria, and ensure that you can repay the loan comfortably. With careful planning and timely repayment, you can make the most of this festive season!