Benefits of loan against property vary across different lenders and loan schemes. However, some of the common mortgage loan benefits are as below:

• Flexible End Use: Like personal loan, loan against property can be used for both personal and business purposes other than any speculative use

• High Quantum of Loan: Mortgage loan is secured against a high value asset, which gives you access to high loan amount, helping you meet your high-end expenses with ease

• Low Interest Rate: The interest rate on a secured loan is lower than the interest rate on an unsecured loan. This makes loan against property a cheaper and a better alternative to personal loans

• Flexible Tenure: The tenure of loan against property usually extends till 20 years, giving you the benefit of lower EMIs and greater flexibility of repayment

• Balance Transfer Facility: Mortgage loan also comes with the feature of balance transfer, allowing you to refinance your existing mortgage loan to another lender giving lower interest rate or better loan terms

• Tax Benefits: Interest paid for the loan against property provides tax benefits under Section 37 (1) of the Income Tax Act, 1961. If the loan amount is used for financing a new house purchase, the interest paid on the loan will get you tax benefit of up to Rs. 2 lakh under Section 24 of the Income Tax Act

The interest rate is a major determinant of the entire cost of your property loan. Because a loan secured by real estate has a higher value and a longer term, the interest rate might have long-term financial consequences for borrowers. Taking advantage of low-interest rates on a loan secured by real estate will lower the EMI as well as the total interest paid. As a result, potential borrowers should seek a mortgage loan with the lowest available interest rate. Citibank now has the lowest rate on a loan against property, starting at 8.20 percent per annum. The exact rate of interest on your property loan will, however, be determined by your lender, credit profile, and loan size.

To apply for a loan against property, you must meet the required eligibility criteria. While the eligibility criteria for availing LAP varies from provider to provider.

Before applying for mortgage loan, use loan against property EMI calculator to know how much EMI you can afford on a certain loan amount, interest rate and tenure. Your loan against property EMI should not put strain on your monthly expenses. Once you find the EMI, loan amount and tenure that you are comfortable with, click the Apply Now button to proceed for the loan against property application process.

Lenders want a list of documents when you apply for a mortgage loan in order to analyse your loan repayment capacity and to confirm that any information you provide is accurate. Now this list of documents may differ from one lender to another. It may also differ depending on your scheme, kind of resident, and type of job. However, the following are the most frequent documents needed to apply for a loan against property:

• Duly filled loan against property application form

• Passport size photographs

• Proof of Identity (Passport Copy /Voter ID card /Driving License /PAN Card)

• Proof of Residence (Ration card /Telephone Bill /Electricity Bill /Rental agreement /Passport copy /Bank Passbook or Statement /Driving License)

• Proof of Age (PAN Card /Passport /any other certificate from a statutory authority)

• Bank Statements (Bank statement /Bank Passbook for the last 6 months) OR Last 6 months salary slips

• Form 16

• Income Tax Returns for the last 3 years

• Processing Fee Cheque

• Documentation related to the property offered as collateral

When taking out a mortgage loan, banks or HFCs levy fees to complete the deal. This amount varies by bank and should be taken into account when choosing a financial institution. Let's take a closer look at these fees.

Fee for processing: It is a mandatory charge that must be paid at the time of loan application. Even if the loan is denied, the financial institution will forfeit the processing fee.

Foreclosure and Prepayment Charges: Foreclosure occurs when a borrower wishes to pay off the entire loan amount before the due date. Prepayment occurs when a borrower decides to pay a portion of the loan amount ahead of schedule. Banks charge some groups a fee for both prepayment and foreclosure.

Additional Fees: Legal fees, paperwork fees, stamp duty, technical assessment fees, title search report fees, and so forth are all regular charges.

The ability to prepay the outstanding loan amount at any point during the loan term is a unique feature of LAP. Individual borrowers with a fluctuating rate of interest on their loan against property are not charged a prepayment penalty, according to the current RBI guidelines. Corporate businesses, on the other hand, are still charged a small cost for prepayment. Prepaying your loan helps to reduce the amount owed on the principal.

Prepayment of a Loan Against Property Has Its Advantages Prepaying a loan against property's outstanding balance has a number of advantages. Here are a few examples:

• Loan terms are shorter: Prepayment of the loan helps to reduce the amount owed. This option can be used to shorten the loan term so that you can pay off the debt as quickly as feasible.

• Savings on EMIs: Once you've paid off your loan, the amount you owe is reduced, and your monthly payments are reduced as well.

• Interest costs are lower: When you pay off a loan early, you pay off the principal first, which lowers your interest rate. This aids in the reduction of interest costs.

• Greater ease of loan repayment within the agreed-upon time period: It would be easier to repay the debt you took out against the property.

Ease for comparing offers: At Tushar FINCorp, you are saved from the hassle of visiting individual websites/offices of lenders to compare the available personal loan options

See all possible lenders: At a single platform, you can see all of the possible lenders (both banks and NBFCs), who can offer loan against property without affecting your credit history and credit score

Instant In-principle e-Approval: Get in-principle e-approval for your mortgage loan application in a matter of seconds when you apply online through tusharfincorp.com

To apply for a mortgage loan online at Tushar FINCorp, you need to follow these steps after logging on to the website and clicking the “Loan Against Property” icon on the home page:

Step 1: Give a few basic details such as loan amount, employment type, mobile number, property city and annual income and click “Proceed”.

Step 2. A list of loan against property offers from various banks and NBFCs that you are eligible for will be displayed as per the chances of approval. Select the loan offer that best suits your requirements and fill out any additional details that may be required.

Step 3. Get an instant conditional e-Approval from the lender. Furthermore, our team will guide you through the documentation process required for loan processing and disbursal.

Q1. What can Loan against Property be used for?

Any loan against a residential or commercial property can be used for both personal and business purposes. In fact, you can use it for anything other than speculative or non-prohibitive activities.

Q2. How does the lending bank decide on the amount I can get as loan against property?

Basically, the bank looks at your repayment capacity. For calculating the loan amount, your income, age, qualifications, number of dependants, spouse’s income, assets, liabilities, stability and continuity of occupation and savings history are taken into consideration. However the eligibility of loan does not, generally, exceed 60 percent of the market value of the property.

Q3. Can there be a co-applicant for loan against property? If yes, who can be co-applicant?

You can include your spuse as a co-applicant and that results in a higher amount being lent. However, if the property is co-owned, all co-owners mandatorily need to be co-applicants.

Q4. What are the processing fees for such a loan?

Processing fee for loan against any property varies from bank to bank and is generally around 1 percent.

Q5. How is the rate of interest on loan against property calculated?

Interest is calculated on daily reducing balance. Your monthly out-go (equated monthly installment – EMI) is much lower as compared to the interest on annual reducing balance.

Q6. What is the tenure of the loan?

Loans against property has a maximum tenure of 15 years, subject to the condition it does not exceed your retirement age. This condition however can be flexible in certain cases

Q7. How to repay my loan?

You repay the loan in Equated Monthly Installments (EMIs) comprising principal and interest. Repayment by way of EMI commences from the month following the month in which you take full disbursement.

Q8. What security will I have to provide?

As the name implies you need to mortgage your property for availing this loan. This mortgage is Equitable mortgage by Memorandum of Entry by way of deposit of title deeds and/or such other collateral security, as may be necessary. Collateral security for by way of assignment of insurance policy or any such other assignable financial instruments are also required, as security to loan if deem necessary by the Bank.

Please do ensure that the title to the property is clear, marketable and free from encumbrance. To elaborate, there should not be any existing mortgage, loan or litigation which is likely to affect the title to the property adversely.

Q9. Can I repay the loan ahead of schedule?

Yes. Prepayment is possible and there is no prepayment fee if you repay the loan after six months of availing the loan if you pay from your own source of funds without transferring the loan.

Q10. How is my loan reassessed if there is a change in status from Non-Resident Indian to Resident Indian?

The repayment capacity of the applicant(s) based on Resident status is reassessed and a revised repayment schedule worked out. The new rate of interest will be as per the currently applicable rate of Resident Indian loans (for that specific loan product). This revised rate of interest would be applicable on the outstanding balance being converted. A letter is given to the customer confirming the change of status.