What exactly Loan Against property means?
Loan against property refers to the amount you can borrow against your property. Banks provide loan against both commercial and residential property. Also, you can take a loan against your rented residential property, self- occupied property or vacant property. It could be piece of land or a house. The amount received as loan against property can be used for acquiring new property or you can use the same amount to take-over of your existing loan by refinancing. It is a kind of secured loan where the border use his/her property as collateral.
Major Factors Playing key role in eligibility of loan are-
1.Tenure
Tenure of loan affect the eligibility of the Loan Against Property.The applicant has two option i.e short loan tenure or long loan tenure. If applicant go for long loan tenure, it will enhance the eligibility. On the other hand, If applicant go for short loan tenure, it will reduces the interest amount, but also decreases the eligible amount of loan.
2.Income
The income of applicant is the most important factor . Regular income ensures that applicant will pay EMIs of the loan consistently. One of the most primary factors is that the applicant must have a steady and regular source of income which ensures that the EMIs of the loan will consistently be paid.
3.Applicant’s Age
Age of applicant is also affect loan application. Long loan tenure will provide, if applicant is young. But, if applicant already reached to retirement age, loan tenure will be short. ITRs Income Tax Returns are mandatory, specially for self-employed individuals. Lender asks for last three years income tax returns. In case of non filing of income tax return, lender would find sufficient reason that applicant is income is irregular
4.Property
The property of the applicant must be free from all encumbrances. All documents related to property needs to be complete. Insufficient documents decreases the chances of getting a loan approval.
5.Rejection of a Previous Application
Lenders always keep records of applications rejected previously. Applying number of times will reduces the getting loan. Thus, one must apply for loan when in need and avoid applying without any reason.
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