Are you planning a grand wedding in the heart of the capital of India? If yes, then you know that no matter how much you plan and save, there’s a chance you may need more funds for the wedding you have in mind.
You have a number of financial solutions to choose from, such as a personal loan, but a loan against property is your most cost-effective option to quick and hassle-free funding. As an application availing of a loan against property in Delhi, you pledge your property for a stipulated period in exchange for funds. And then you repay the entire sum with interest through EMIs.
However, to be able to enjoy the benefits of a property loan, make sure you are well aware of its various aspects. This is especially true for first-time borrowers. So, here is a complete guide to a loan against property for beginners.
All You Need to Know About LAP Loan Features & Benefits
Attractive Interest Rates
Since property loans are secured loans, the interest offered is relatively lower as compared to other unsecured loans. While most lenders typically offer rates starting at 8.3%, a lot depends on the type of interest you choose (fixed rate or floating rate). A fixed rate is one that remains fixed throughout the tenor and does not get affected by any changes in the market trend. A floating rate refers to one that is likely to change with any fluctuations in the market trends during the loan tenor. Whichever rate you go for, ensure that you understand the policy terms set by the lender.
The tenor for a loan against property can extend up to 18 years. This allows the borrower ample time to plan their finances and repay the full amount in a timely manner. You can also choose to pay the loan amount with affordable EMIs every month. A loan against property EMI calculator can help you evaluate your monthly dues.
Exemptions on Taxes
A property loan also comes with tax benefits under Section 24 and Section 37 of the Income Tax Act in India. Both the sections allow you tax exemptions on the loan interest.
Balance Transfer & Flexi Loan
It may so happen that you wish to switch from your current lender to a new one who might be offering better rates of interest. In that case, you can take advantage of the balance transfer facility and transfer your existing loan balance to the new lender. Another useful feature is the flexi loan facility that allows you to make use of the funds under a pre-approved cash limit, whenever needed.
Know Your Eligibility
If you are planning on applying for a loan against property in Delhi for the first time, do not forget to go through the eligibility criteria set by the chosen lender. The basic criteria include the following:
- Borrower must be between 23 years and 62 years of age
- The borrower must be a residing citizen of India
- The borrower must have at least 3 years of experience working in a multinational organization or the public/private sector, or s/he must have steady income through an enterprise with a vintage of 5 years
Besides, your credit history or CIBIL score also counts as criteria that needs to be met. Most lenders consider 750 and above the desired score to be eligible for a property loan. Some may even offer a LAP at a score of 725, but your loan terms may not be favourable.
How to Apply for a Loan Against Property in Delhi
Applying for a property loan in the city of Delhi is quite simple and straightforward. You can either do it offline or online. While the offline procedure will require you to manually visit the lender’s office and complete all paperwork, the online procedure will only take a minute. Here is a step-by-step guide to the application:
- Visit the lender’s official website to access the online LAP loan application form
- Enter your details as required, such as your name, address, age, employment status, salary, information related to the property in question, etc.
- Follow up with the representative and submit all documents relevant and important to file the loan
The lender will then get your profile and documents verified and the property to be pledged evaluated and checked. Once you get the loan approval, the money is transferred to your account in 3-4 working days.
Needless to say, the online procedure is easier and a lot faster than the offline mode.
A loan against property in Delhi is one of the best ways to finance your personal goals without having to dip into savings. There are many lending institutes providing loans at affordable rates along with other benefits. This article can help you gauge LAP loan features, eligibility, and application process before making an informed decision.