A thorough understanding of the lending process is essential in today’s dynamic finance sector, which is being rocked by digitization. Doubts and delays in the loan application process might result from misinformation and erroneous ideas about particular borrowing and lending methods. Additionally, it was noted that common questions borrowers have include loan against property myths, LAP eligibility requirements, and common myths regarding mortgage loans. These myths can lead to misinformation that results in financial disasters and delays in your ability to obtain finances.
As borrowing funds in the form of loans can have a direct impact on your personal finances, it is important to research and keep your facts in check about the LAP eligibility criteria and credit avenues available to you before deciding upon a certain procedure.
Loan Against Property (LAP) is one of the most conventional methods used by borrowers who require high-value funding. As compared to personal loans, a Loan Against Property is more cost-effective as you can avail of higher funds with lesser rates of interest. You can utilize the loan funds as per your requirements, including higher education, weddings, business property expansion, medical emergencies, and even for traveling purposes.
However, you might get confused amid floating Loan Against Property myths implying that the loan is not a safe option for funding. Even if you choose not to apply for a loan against property, it is better to clarify your doubts about the loan procedure to understand why it can be right for you in case of future events. In this article, let us debunk some of the most common myths about mortgage loan and loans against property.
Myth 1: You Can Use the Loan For Limited Purposes.
Fact: This is one of the most common myths about mortgage loans. Just like any other property loan, a Loan Against Property comes with no restrictions or limitations. You can use the funds for various purposes, no questions asked. Home loans and auto loans have limitations as they can only be used for predetermined purposes. Due to this, borrowers generally prefer personal loans to take care of the expenses that fall outside these parameters. However, a Loan Against Property allows you to use the funds according to your requirement with affordable interest rates.
Myth 2: Your Collateral Can Only Be A Residential Property.
Fact: A Loan Against Property is flexible, which makes it a preferred choice among buyers for availing high-value funds. When it comes to pledging collateral, there is no restriction on the type of property. This means there is no rule that only residential properties can be offered as collateral. Lenders also accept commercial properties, including warehouses as well, allowing you to avail of secure and easy funding.
Myth 3: You Cannot Live In or Use The Pledged Property.
Fact: Another common myth about mortgage loans is that you cannot use the pledged property, which makes borrowers reconsider applying for a loan against property. While the lender will be the owner of your property till the time the loan amount is paid back, you have full rights to continue using your pledged property as you wish. This includes occupying the property yourself or renting it to tenants. Your rights may get revoked if you delay your EMI payments or default on the loan. The loan contract allows the lender to seize your property to compensate for the amount you owe them.
Myth 4: You Need to Be In A High-Income Bracket And Have A High Credit Score.
Fact: Even with a moderate income, you can qualify for a loan against property. These loans can be taken by salaried and self-employed individuals, however, if you have low liabilities with high property value, availing of LAP would be easier. For long-term customers, credit history and etiquettes will also play in loan disbursal.
A credit score over 750 will make it easier for you to get a loan against property, but it cannot guarantee that you will get a loan. Other factors such as your repayment capacity, property’s value, and legal aspects of your property may influence the lender’s decision.
Myth 5: Loan Against Property is Dangerous and Expensive.
Fact: If you fulfill the LAP eligibility criteria, a Loan Against Property could be a right fit for you. Paying the loan amount on time will not put your pledged property at risk. As soon as the payment is done, you will get your property papers back. While asking for a loan against property, you can choose an EMI amount that will be easier to pay as not paying the installments on time might hamper your credit score and ultimately put your property at risk. You can opt for a longer tenure to counter this issue. You can also file an online Loan Against Property application which is completely safe.
In Conclusion
Before opting for a loan against property, educating yourself and being aware of its various aspects will help you differentiate between misconceptions and reality. If you still have any doubts and concerns about the loan procedure, you may consult a financial expert who will help you clear your doubts and make mindful decisions.
Whether it is a business or a personal requirement, a Loan Against Property can be a useful financial tool for you. Borrowers can benefit from affordable interest rates with simple application procedures.
We, at Credit success, understand the value of your property and assets. To help you leverage them in the best way possible, we offer Loan Against Property at attractive interest rates. We are here to make your Loan Against Property application seamless with a quick and easy approval process, no hidden charges, and minimal documentation.
Our LPA eligibility criteria is simple, comprising age, business vantage, income, and citizenship. Whether you are a salaried employee, a self-employed professional, or an organization, you can apply for Loan Against Property through simple steps, without the need for submitting extensive paperwork.
For our online Loan Against Property application, click on Apply Now, fill the application form with basic details, upload the required documents, wait for document verification and assessment, and receive quick loan approval. You can also use our free Loan Against Property EMI calculator to find out the right EMI amount for you.
