You cannot evade emergencies but how you prepare yourself to face them makes a lot of difference. Whether it is business expansion, buying a new property at a steal deal, a dream wedding or any personal requirement, cash flow is necessary to take things forward. When facing a cash crunch on immediate requirements, loans are the best options to go for.
While there are multiple loans in the market tailored for multiple purposes, one would wonder which is the best one to avail. Any requirement can be funded using a loan against property. A loan against property is a loan availed by leveraging an immovable asset. One can avail 60 to 70 % of the collateral’s market value based on the property type pledged. Since this is a loan against collateral, the interest rates are lesser than the unsecured loans.
Here are a few features of LAP loans that make it the best solution to your financial worries.
Features of LAP Loans
● More Extensive Sanctions
The loan sanction amount is higher than other types of loans since you are pledging a valuable asset of higher value. Higher loan amounts help you efficiently use the funding for a large business, wedding, education, home expansion, medical emergencies, or higher investment.
LAP loans can be availed using multiple types of collateral. It could be land that you own or a house for commercial purposes. Asset remains collateral with the lender until the total amount is repaid.
You can take the loans against any residential or commercial properties which are immovable. Additionally, you still repair the owner of the property during the whole tenure of the loan.
● Less Scrutiny of Borrowers Credit Profile
Since the loan against property is secured against collateral, the lenders usually. This makes it less prone to rejection making it a sure-shot way to obtain emergency funds.
● Flexible Tenure
A flexible and convenient tenure offered by the lenders helps you choose the pace of repayment. You can decide what your repayment schedule can be according to your ease by opting a long-term repayment or a short-term repayment. Some lenders stretch the tenure even up to 20 years since there is collateral involved. Flexible repayment helps you start stress-free and plan your finances at ease by paying small EMI outgos. You can also choose to prepay the loan in advance when finances get better at zero prepayment charges.
● Lower Interest Rates
Collateral loans mostly gave lesser interest than loans without collateral involved. Hence loan against property interest rate is affordable as low as 9% depending on your eligibility. The economical interest rates save a reasonable sum for you compared to other types of loans.
● Speedy Sanction
Though the waiting time of sanctioning loans with collaterals is higher than the ones without collaterals, the sanction is comparatively speedy. Your financial profile is not the eligibility criteria here. The loan swift disbursal process will help you meet your opportunities on time. Additionally, if you use Fullerton’s instant loan app you do not have to spend time on paperwork as the documentation is hassle-free online. Applying lap through the online app also propels the speed of sanction as the documents are verified digitally.
● Eligibility Criteria
LAP loans are a good source of finance for anyone looking for huge funds immediately at attractive interest rates. That said, the eligibility for these loans does depend on credit history, employment status, and citizenship requirements like other loans.
The eligibility criteria for a loan against property are mostly
● Must be an Indian resident or Indian SME
● Must have a steady flow of income
● The credit scores should be above 750
Documents Required for Obtaining Loan Against Property
The documents required for a loan against property are:
● Filled-in application form with a recent color photograph
● PAN Card
● ID Proofs
● Address Proofs
● Income Tax Returns of the last three years
● Salary statements/ Form 16 in case of salaried employees
● bank statements for the past six months
● Processing fee cheque
● Original documents and title deeds of the property are offered as collateral.
You can calculate EMI for the loan against property using a property calculator to quickly understand your monthly installments based on your selected amount and tenure. The calculator will help you plan your finances more efficiently. All you have to do is change the interest, loan tenure and loan amount that you estimated to determine the monthly EMI’s that you can pay.