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March 2020
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Planning to buy a second home? This could be your chance to leverage from the existence of your pre-owned properties. You can take a loan against property by mortgaging any of your pre-owned properties and buy the house.
Perks of Taking a Loan Against Property for buying a second home:- 1. You won’t lose the Ownership of your Home: Firstly, when you take a loan against an already owned property to buy a second home, you’ll never lose the ownership of the new property even if you fail to repay the dues. Banks and NBFCs would only be able to sell property which was mortgage instead of the property which was bought using the loan amount. 2. You can Sell the Property whenever you Wish to: Real-estate market is very dynamic in nature and the property rates can go down or up within a fraction of seconds. So, if your primary reason for buying the property is to resell it in order to gain profits, a loan against property would be a better way to finance the purchase. This way you won’t have any restriction on the resale of property recently purchased. You can sell it whenever you want to and earn decent profits.
Bottom Line: The eligibility criteria for loan against property is different from that of home loans and so, you should better check it in advance. In addition, the tax benefits slightly differ in case of a second home compared to the first one. Do read them before applying.
Additional Read: Go For Second Home Loan With Loan Against Property
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Planning to apply for a loan against property to secure a huge sum which can be used for varied needs such as buying a car, buying a house or renovating it, etc.? A loan against property would be a good way to finance your such needs but only if you get approved for it quickly. Though instant approval and secured loan don’t go hand in hand, you can take the below shared measures to ensure the money is sanctioned as soon as possible.
1. Keep your Eligibility to Value Ratio Low In simple and straight words, if you ask for a lower sum even if your overall loan eligibility is higher, the approval might happen quicker. For instance, if the property’s value is 1 crore and you only ask for 10 lakhs which is only 10% of the total eligibility, your chances of getting approved quickly increases. 2. Mortgage Properties Solely Owned by you Secondly, mortgage properties which are solely owned by you. If there’s a second owner of the property you mortgage, you’ll have to follow a legal process and obtain their NOC without which the lender won’t approve the loan. 3. Keep your Loan Tenor short Shorter tenor means lower risk for the lender, which directly benefits the borrower by ensuring faster approval. So, use the loan against property EMI calculator and find out how quickly you can afford to repay the debt. Though you should always ensure the EMI size doesn’t exceed your monthly capability. Additional Read: Loan Against Property Instant Approval: 6 Things to Keep in Mind |