FA, 2020 amendment increasing...
| Bank Name | Interest Rate Range (%) | Processing Fee (%) | Maximum Loan (Lacs) | Maximum Tenure (Month) | Forclosure Charge | |
|---|---|---|---|---|---|---|
|
10.99%
|
|
|
360
|
4%
|
|
| Bank Name | Key Features | |
|---|---|---|
|
|
Interest rate
10.99%
Fore closure charge
4% |
|
The two loans are poles apart. A Loan against Property is a multi-purpose loan. The end-use could be funding your elder child’s marriage, your younger child’s education abroad, expanding your business. The collateral (secured asset) for this loan is a property which is already in existence or a plot of land. A Home Loan on the other hand is taken only for the purpose of buying a residential property.
Your assets like gold, FD etc. can be used as collaterals for loans. Real Estate is a valuable asset. You can leverage this asset and obtain necessary funds.
A personal Loan is also an all-purpose loan. However, no collateral is required for a personal loan. If you have a property, you should leverage it for funds. A Loan against Property scores over a personal loan for the following reasons:
Yes. Most banks are willing to offer loans to salaried Non Resident Indians (NRIs). They should live in select countries and should work for reputed organizations.
Most banks don’t require you to specify the purpose for which you take a Loan against Property, upto a particular limit. Above that, they might require you to provide an undertaking that the loan is not for a speculative / illegal purpose.
Yes. You can take a Loan against Property by providing a Residential or Commercial Property as collateral. You can also take a loan against a plot of land.
Unlike a Home Loan, no tax incentives are available on the EMIs in case the Loan against Property has been availed by a salaried person. A businessman however can claim tax deduction on the entire interest amount paid on the loan if he can prove that the loan funds were used to improve his business.
The bank shall determine the value of the property after conducting a formal valuation process.
The documents differ for a salaried and self-employed person:
A Salaried applicant needs to submit:
1. Application form with photograph
2. Identity and Address Proof
3. Latest Salary Slips
4. Form 16
5. Bank Statements (6 months)
6. Processing fee cheque
A Self-Employed applicant needs to submit:
1. Application form with photograph
2. Identity & Address Proof
3. Business existence & Educational proofs
Banks usually take around 2 weeks for disbursing the Loan against Property once all documentation is completed.
Yes. The banks usually require that the property be insured against flood, fire, flood, earthquakes etc. during the loan tenure.
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