Online Loans – Would You Like To Take A Home Loan? Important things to remember | Fintech zoom


Loans Online – Would you like to take out a real estate loan? Important things to remember

Would you like to take out a real estate loan? Important things to remember

New Delhi: Business people typically use loans against real estate to meet their cash flow needs. A real estate loan is a secured loan against an immovable asset (land or property) as a mortgage with the lender. This includes a house, an office or a business. The borrower should be the owner of the property and the title should be clear.

The mortgage loans for assets like real estate help them get a great loan at lower interest rates. Some employees use this product to pay for large expenses such as children’s weddings or their education.

However, there are a few important things to keep in mind before deciding on extensive financing such as a home loan. First, most lenders typically sanction a loan amount of up to 75% of the current market value of the property being pledged. However, you shouldn’t borrow too much just because you are eligible for a higher loan volume and stick to your exact funding needs so that it is easier for you to repay your loan on time. All of your debt taken together should ideally not exceed 50% of your household income.

Second, while it is a secured loan product, your income and creditworthiness are taken into account when sanctioning a home loan. That is, you will only get the best loan deals if you have sufficient income (which will enable you to make repayments on time) and a credit score of over 750-800. Third, your loan application could be denied if there is no absolute clarity about the ownership of the pledged property, the papers are not in order, or the property is in a dilapidated condition.

Bank Interest rate (in%) quantity
State Bank of India * 8.80-9.65 Up to 7.5 crore
Bank of Baroda 8.05-13.20 2 lakh – 10 crore
Axis bench 8.05-13.20 5 lakh – 5 crore
HDFC bank 8.05-13.20 Up to 65% of the property value
Indian bank 8.05-13.20 Up to 65% of the property value

(Source: Paisabazaar.com)

All of the above loans have a term of 15 years

* Loans against real estate cannot be used for business purposes

When taking out a loan, always opt for a shorter term, as this saves the entire interest expense. LAP also takes time to pay out. The lender needs to determine your property value before deciding on the loan amount.

Entrepreneurs can also deduct the interest portion of the loan from tax.

Loans Online – Would you like to take out a real estate loan? Important things to remember

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