Loan against property is secured loans. The borrower mortgages their property to avail substantial loan amounts. Although the value of the property is a major determinant for the loan amount, LAP interest rate is mostly dependent on the creditworthiness of an individual.
# Choosing Easy EMIs – A longer tenor tends to pose a lower EMI, which makes paying debt easier. Despite the benefits of a longer tenor, it also increases the total interest payable and the total cost of the loan. Borrowers who can pay a higher EMI should opt for a short tenor to ease the burden of payment.
# Utilising Other Investments – Most individuals possess securities like fixed deposits, mutual funds, etc. Utilizing such resources after their maturity makes paying debt easier.
# Insurance Coverage – Loan against property can be tricky to pay back without an organized payment method. A higher credit amount may necessitate a borrower to have insurance coverage in place. Such an insurance plan can financially cover the loan repayment in case of any mishap befalling the borrower and hampering his/her income.
# Balance Transfer – A profitable method is a balance transfer. In this process the borrower can transfer their existing loan dues to another financial institution, offering a better interest rate. Lenders generally offer competitive LAP interest rates. A borrower may find another lender offering lower interest rates and opt for a balance transfer of their existing loan already on higher interest.
There are multiple factors that affect the interest rate for loan against property. Know them before applying for a loan. Refer to the leading lender for the most beneficial loan terms.
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