Can NRIs take the Loan against Property?
NRIs can definitely take a Loan against Property. If an NRI owns commercial or residential property in their name they can very well borrow against that property. The process for getting loan against property is almost the same for Indian citizens as well as NRIs. Many lending agencies are offering loan against property to NRIs at lucrative interest rates and least documentation.
What is meant by market value of a property?
The amount a person receives by selling their property under present conditions is known as market value of a property. Stamp duty is paid according to the market value or agreement value of the property whichever is higher. The market value of an asset is liable to fluctuations. It represents what a buyer is willing to pay for a property and not its actual worth.
Can the money obtained for Loan against Property be used for business purposes?
You can surely use the money for your business purposes or even personal activities. However, ensure you don’t use the money for any illegal acts. Sometimes mortgage loan is taken to meet wedding or education needs or even to purchase/build a property. However, most mortgage loans are taken for business purposes. And when there is a need for emergency funds at reasonable interest rates, then why not avail it.
Can only residential properties be used for Mortgage Loan?
Not exactly, you can avail the loan by mortgaging either your commercial or residential property. It could be rented or self-occupied property, which means it could be a plot of land or a house. Most banks welcome commercial as well as residential properties for mortgage.
Can the Loan against Property be prepaid?
Loan against property is the most flexible type of loan because the end use is totally as per your wish. The principal as well as the interest amount can be prepaid before the end of the loan period. After paying a certain number of EMIs you are free to foreclose your loan. That means you can repay the entire loan amount if your pocket permits. You will not have to pay the interest part of your loan, so you can save a lot this way.
- Which bank is best for Loan against Property?
Due to its low interest rates, Citibank is considered one of the best banks for mortgage loan. However, there are many other banks also offering lucrative interest rates for loan against property.
The listed below banks are some of the more well known offering loans against property:
- HDFC Bank
- Edelweiss Financial Services Ltd
- Aditya Birla Finance Ltd
- Fullerton India Credit Company Ltd
- Capital First
- HDB Financial Services Ltd
What are the different charges for Mortgage Loan ?
Following are some of the charges the bank imposes, apart from mortgage interest rates:
- Processing fee: This fee is slapped during application for the loan. However, you can reduce it through negotiations.
- Foreclosure fee: Though not all banks, but some banks do charge a foreclosure fee. In the event you wish to close the loan before the end of its validity you will have to pay this fee.
- How should you select a bank for Loan against Property?
Before deciding on your lending bank, you need to go through many aspects of the said banks. You should check to see if you can meet the criteria for the amount you require. Next, check and see their rate of interest, processing fee and other charges. Also look up their quality of service. This is very important to get you comfortable to seek a loan from their bank.
- Is the CIBIL score important for Loan against Property?
CIBIL score is one of the most important things while taking a mortgage loan. It shows your track record of repayments. The score should be at least 750 if not more while applying for a loan. 350 – 750 is an average score which could be unacceptable, but below 350 is likely to lead to rejection of your loan. A poor CIBIL score can be a detriment to availing a loan. So, you must ensure you maintain an excellent CIBIL score by making timely payments.
Can I be eligible for the Loan against property even with a bad CIBIL score?
Most applicants return disappointed at not having secured a loan due to a poor CIBIL score. However, to meet this deficiency, Bajaj Finserv offers mortgage loan for individuals with a poor CIBIL score.
It is possible for you to obtain a loan with a low CIBIL score. However, you must be ready to pay a higher rate of interest.