Let your property take care of your needs. The increase in the price of most of the thing increased the debt requirement. Loan Against Property (LAP) refers to a multipurpose loan that can be obtained by mortgaging your existing residential or commercial property to cope with the financial crisis. This loan puts funds at your disposal for crises like education, marriage, dream vacation, home renovation, debt consolidation, or even business expansion. By opting for LAP as a borrower, you will get financial assistance at a very reasonable interest rate and can spend the amount for any reason.
This loan can be used by salaried employees, freelancers, associated companies and private companies Ltd. Banks have their own methods for estimating loan eligibility. However, it ranges from Rs. 2 lacs to Rs. 10 crore. The exact amount depends on your property's valuation, income, existing savings and obligations, credit history and, of course, ability to pay.
The loan requires simple documentation, mainly an application form duly signed by the borrower, proof of identity and residence, income documents; Last six month bank statement, documents to substantiate the existence of the business when required and a processing fee check. The borrower must have a regular source of income to avail the loan. However, the funds are offered against collateral, evaluation of their potential to repay the loan amount in full is mandatory. These days, most of the lenders offer these finances online. Applying online is less time consuming and gives applicants the ease of applying while sitting in the office or at home with no hassle.
Banks would offer you two types of interest rate, namely, fixed rate and floating rate. The interest rates on this loan generally range from 12% to 15.75%. LAP is generally approved for a term of 15 years (180 months). The borrower may choose to make repayments using the Electronic Clearing Service (ECS) or Post-dated Checks (PDC). A customer can always prepay a partial loan or repay the entire loan at any time during the term according to the lenders' standards for the loan. For most lenders, there are prepayment penalties that must be paid if the loan closes before the full term.
Various banks, private financial institutions are lending money these days. If you're opting for a home loan, be sure to do a lot of surfing to take advantage of the best risk-free deal. At the time of finalization, be sure to check all fines and fees. There are certain benefits of availing such loans. The borrower has the opportunity to build a good record with a bank by making payments on time.
The client can enjoy various types of tax benefits, many banks or credit authorities offer other types of advantages, such as insurance benefits, a savings account with zero balance, etc. One must make sure that one keeps up with the payment. You should always remember that you have pledged your most valuable asset as collateral against the loan. A potential loan borrower should not rush through things while availing a loan.
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