What is a loan against property?
A loan against property is a secured loan offered by banks and financial institutions by using the property you own as collateral. Borrower is given a loan up to 60-70% of the property value. Though the property is offered as collateral, the owner keeps the ownership and can continue using it. Loan against property is granted against residential, commercial as well as industrial property.
What avail loan against property?
Loan against property is a secured loan, as your property is kept as collateral with the bank and in case of loan default bank can take over the property.
Documentation is easy as property is in your name. Loan processing is much faster than a home loan.
Lower interest rate:
Interest rates of loan against property are generally around 1-2% higher than home loans but are way lower than personal loans whose interest rates can be as high as 20%
Loan can be availed of 5 lakhs up to 10 Crores.
Banks offer loan against property for a tenure of 15-20 years.