According to a recent report, mortgage loans, inclusive of loans against property (LAP) and housing loans, are expected to reach a market valuation of Rs.46.1 crore between 2019 and 2024. Ideally, it is the accompanying features and benefits of these credit options that make them viable financing solutions for many individuals. Things to Consider While Availing a Mortgage Loan in India.
Regardless, to apply for such a financing option, it is always recommended to check and consider a few things in advance. It will help individuals to gain an idea of mortgage borrowing requirements and help to streamline the application process accordingly.
Points to check before availing a mortgage credit
One must present it a point to check these following features provided by mortgage loan lenders and compare the same with offerings of other financiers to make the most of this credit option.
Both salaried and self-employed somebody can apply for this loan. However, applicants need to meet some requirements to qualify for the credit. For instance,
A. Requirements for resident salaried applicants
● They should be between the age of 33 and 58 years.
● Must be employed at an MNC or a company in the public or private sector.
B. Requirements for self-employed applicants
● They should carry regular sources of income.
● Applicants should be between the age of 25 and 70 years.
Other than these, applicants may be required to meet other eligibility criteria like CIBIL score within a specific threshold or property location. Applicants should find out about additional requirements in detail and also find out how mortgage loan influences CIBIL score and vice versa to stay informed.
- Interest rate and interest type
Since it is a secured credit option, the accompanying rate of interest is relatively low when compared to most unsecured advances. Nevertheless, applicants must find out the prevailing property loan interest rate and type in advance and then proceed to compare them to land the most competitive offer.
Ideally, there are two types of interest rates, namely – fixed rate and floating rate, which impact the loan value differently. For instance, a floating interest rate is subject to changes with any change in the key lending rates.
So, when the rate increases the loan EMIs of a mortgage loan with a floating interest rate type also increase. However, the same remains fixed throughout the tenure in case of a loan with a fixed interest type. Consequently, individuals must ascertain which interest rate type is a better option when they avail a LAP.
Loan value and repayment tenure
Leading financiers extend high-value mortgage loans against simple terms of repayment. For instance, salaried individuals with a good credit history and healthy repayment capability can avail up to Rs.1 crore as loan value. However, the loan amount is mostly based on the property’s value and the applicant’s creditworthiness.
Usually, financiers offer a flexible repayment tenure to borrowers that may extend up to 20 years. Regardless, individuals must note that tenure has a high influence on loan EMIs and on loan against property interest rates. For instance, a longer loan against property tenure reflects a high-interest amount and low EMIs. So, individuals should count on the same while selecting a suitable loan tenure.
Most financiers require individuals to submit a list of documents to apply for a loan against property. Though the set of documents may vary from one financial institution to another the most common ones include –
● Latest salary slips.
● Bank statements.
● Aadhaar card.
● Proof of address.
● Property documents.
Providing an accurate set of documents not only helps with initiating the verification process but also minimizes the risk of a loan application rejection.
Individuals should also find out if the lender provides additional features like a balance transfer facility and a top-up advance. Such features allow existing borrowers to access additional funds or switch to other lenders to lower their overall loan burden.
Leading financiers also provide customized pre-approved offers to customers, thus streamlining the process of availing a loan. Such offers usually accompany financial products like loans against property and home loans. Check your pre-approved offer now by entering the name and phone number.
Besides these features, one must also check the promptness of loan processing and loan disbursal. It will allow applicants to meet their urgent requirements readily with much ease. Furthermore, while comparing mortgage loans, one must pick a financier that allows room for negotiation for interest rates and terms of services.
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