Things to Check Before Applying For a Loan Against Property

A loan against property or LAP is one of the most popular credit options for most people in India. Also known as a mortgage loan, a loan against property is disbursed against the mortgage of a property. If you own a property, you can simply apply for a loan against the property to fulfill your financial requirements. The property owned can be a house, plot, or commercial space. It is a secured loan, handy for salaried professionals and self-employed people to help them handle financial emergencies. The top NBFCs in India provide loans against property with competitive interest rates. They sanction the loan amount as per the current value of the property. However, here are a few things to check before applying for a loan against property.



Consider the Property Value


First of all, you should check the current value of your property. Remember, all leading banks and NBFCs provide loans considering the current value of the property you keep as the mortgage. However, the funds offered by lenders on your property differ. Thus, it is vital to conduct some research first regarding how much your property is valued.

Check Interest Rates

The next important thing you have to check is the interest rate of the loan against the property. The interest rate of any loan will play a crucial role in deciding the amount you will have to repay during the repayment terms. Before finalizing a specific bank or non-banking financial company (NBFC) for a loan, you must check the interest rates on offer. While a little difference in the interest rate may not seem much, it can affect a borrower’s ability to repay the loan amount.

Select the Right Tenure

While the repayment tenure and terms vary from lender to lender, you must keep your budget and repayment capacity in mind while selecting the tenure. It is wise to use an EMI calculator to understand the amount you will owe the lender. You must choose the right tenure, so the repayment can be on time to avoid losing possession of the mortgaged property.

These are some of the most important things to check before applying for a loan against property. Make sure you select the best NBFC for a loan against property.

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