Indian lenders are perhaps the most ingenious when it comes to loan types. There are plenty of loan options for Indian citizens. Each loan caters to a specific category of borrowers. You can stay assured that whenever you need money, you have plenty of options to choose from.
However, if you need a flexible loan with no limitation on the maximum amount and has a long repayment term, nothing can beat a loan against property or property loan.
Although loan against property interest rates are one of the lowest among loans, you can reduce it even further by following the three tips mentioned below:
Increase Your Loan Against Property Eligibility
loan against property eligibility criteria depends on the borrower’s credit score, income, age, financial condition, and property value. You can get a loan against property with the lowest interest rate if you score high on all parameters.
The credit score is the first parameter that influences the interest rate of a loan against property. Lenders charge a higher interest rate when your credit score is below 800. However, an 800+ score makes you eligible to receive the lowest rate. Along with credit score, lenders also evaluate your net monthly income and financial condition. For example, if you earn INR 20,000 per month, and your fixed liabilities (including other EMIs) is INR 10,000, the lender will consider your income as INR 10,000. In such a case, the lender will calculate your loan eligibility based on the net income amount and not the gross one.
When your income or credit score is less, and you still want to receive a lower loan against property interest rate, your age should be far away from the maximum age of loan application (55 for salaried and 60 for self-employed), and your bank account balance should be enough to take care of one year’s EMIs.
Modify the Loan Amount And/Or Tenure
It is a known fact that the longer the loan term, the higher the interest rate. Similarly, if you apply for the highest loan amount based on your eligibility, the loan against property interest rate might be higher.
For example, if you are eligible to get a loan amount of INR 1 crore and you apply for the same amount, the lender may consider the loan risky. In contrast, if you choose a loan amount of INR 80 lakh, the lender will feel assured that the threat is minimal, as your eligibility is higher than the amount you seek.
Hence, before choosing a loan amount or term, try to check the EMI amount using a loan against property calculator and select the right amount or term.
Select the Best Lender
It is not too challenging to find the right lender when you know what parameters separate the best from the rest.
Any reputed lender will keep all its charges in the public domain. You can conveniently visit the lender’s website and check their terms, conditions, and charges, before selecting the right lender.
PNB Housing Finance, for instance, has a website that provides you with all tools and calculators you need to find the loan cost. You can also check the fees that the lender charges, the documents required, the eligibility criteria, loan amount, and every other information you need to decide.
When you choose a transparent lender, the chances of getting the lowest loan against property interest rate are higher.
It is better to research several lenders and options before choosing the one that fits your requirements. Remember to pay loan EMIs regularly, as any default may affect your credit score negatively and make it difficult to avail a loan against property with a low interest rate.