How does loan against property help you with future financial emergencies?
Loan against property can be availed by keeping your house as collateral and use this money in times of future financial emergencies.
The first thing that comes to the mind of any salaried individual is security for the future. Our minds are constantly plagued with questions like ‘where will the money come from?’ One of the best and yet not often thought about means to ensure this money flow is a loan against property.
What does loan against property mean?
The term is quite self-explanatory. It means a loan provided by the mortgage of a property. This loan is usually around 40-60% of the value of the property. The best thing about loan against property is that it belongs to the secured loan category. This implies the person who has borrowed the money gives a guarantee to the lending institution about returning the money by using his property as security.
Features of loan against property:
There are certain features of loan against property which ensures that this is the most secure backup plan for future financial emergencies-
1. Lower limit which starts from 2 lakh without any upper limit
2. Option for both fixed and floating rates are available
3. Tenure of repayment is longer
4. Interest rates are cheaper
5. The method of processing the loan is extremely simple
6. The value is placed for 40-60% of the property
Benefits of loan against property:
The best thing about loans against property is that they are extremely easy to avail. The trust of the lending institution usually tilts in favor of a borrower who asks for a secured loan as opposed to the one who asks for an unsecured one. Loans against property have numerous benefits when it comes to thinking about the future-
1. Higher loan amount- if you have the correct kind of property to mortgage, then chances are that the loan amount provided against the property will be extremely high.
2. Multiple options for repayment- the repayment of the loan can be made either in parts or paid off entirely in advance without any sort of charges for the same.
3. Quick approvals- loans against property are much easily approved as the loan is secured. It typically takes only 1-2 days for the loan processing to be completed.
A loan against property is actually the fastest way to raise money. Moreover, a borrower knows what they are getting into and non-repayment of the loan would imply confiscation of the property. It provides you access to immediate funds all while simply placing your property as collateral.
For a salaried individual who is dependent on the paychecks, loan against property is the best option. It helps you plan out your expenses and ensures that you know where you have to put your money in. Whether it is for the education of your children, marriage, medical expenses or any other sort of unforeseen expenditure, loans against property is the easiest and best available guarantee for a future monetary emergency.