A loan Against Property is a type of secured loan that is available for both salaried individuals and enterprises. You have to mortgage your residential or business property to get a loan. The bank approves the credit amount based on the property’s current worth and legal issues. As a loan applicant, you can mortgage your own home, a rented property, or any piece of land you own. However, you must ensure that the property is free of legal disputes. Let’s learn more about document requirements and eligibility for a loan against property.
Eligibility for loan against property
Whenever you take a loan against property the lender or the bank checks your eligibility. To apply for a loan against property you should pass the eligibility criteria. Your repayment ability can be calculated using parameters such as your monthly obligations, location, salary, job and so forth. The loan amount will also be determined by the value of the property you are selling and your ability to provide the necessary documentation. Below mentioned are some of the eligibility criteria required:
- Should be an Indian citizen.
- You must be at least 21 years old at the time of the loan application.
- The maximum age of the applicant must be 65-70 years.
- Must be either salaried or self-employed.
- Should have the needed minimum earnings or monthly repayment ability with a minimum income of 3 lakh per annum.
- A good CIBIL score is also required, usually 750 or above.
Loan against property eligibility calculator
By using a loan against eligibility calculator you can easily calculate your eligibility for a loan against property. You can find an eligibility calculator online and use it to determine your eligibility in any city in India. Banks always consider property value, repayment capability, applicants’ age, employment, total family income, dependants, your property’s legal issue, total assets and previous loans.
A loan against property eligibility calculator can help you easily go through the above-mentioned factor and calculate the total amount you are eligible for.
Factors that affect eligibility for a loan against property
The following factors affect your eligibility for a loan against property:
The value of the property
The value of the property is the deciding factor in how much loan you can avail against it.
Your credit score is determined by your credit history and how timely you pay your EMIs and dues. On-time payment of bills, payments, and EMIs ensure a great credit score. A good credit score allows you to obtain additional benefits such as cheaper interest rates and flexible repayment plans. A credit score of 750 or more is generally considered great for obtaining loans.
Large outstanding debts have an impact on loan eligibility. Prior debt repayment is crucial to reaching high eligibility. It demonstrates your ability to repay the loan against property.
The higher an applicant’s income, the more likely they are to be approved for a loan against property
Age of the applicant
While applying the applicant must meet the minimum age criteria and should not exceed the maximum age bracket.
The applicant’s job stability as a salaried or self-employed individual plays an important role in deciding the applicant’s eligibility.
How can you boost your chances of getting a loan against property?
Here are some pointers to help you increase your loan against property eligibility:
Keep a high CIBIL or credit score.
In any lending transaction, your CIBIL, or credit score, is crucial. Maintain a high CIBIL score by repaying your loan on time, paying your credit card bills on time, and keeping a solid balance of unsecured and secured loans. Many lenders generally prefer a credit score of 750 or above.
Increasing your earnings
Any more income increases your chances of your loan application being granted. It means you have more money to repay without going into debt. This increases the lender’s confidence in your ability to repay.
Documents required for a loan against property
The following is the document required for a loan against property that financial lenders will require you to submit:
Identification proof: Aadhaar card, Passport, Voter’s ID card, and other forms of identification are acceptable.
Proof of address: Passport, Ration Card, Driving Licence, etc.
Proof of income: Pay slips, bank statements with salary credits, form 16, etc.
Property documents: Registration certificate, Sales Deed, Lease Agreement, Property Tax Receipts, Property Insurance Documents, and so forth.
Always keep your documents ready beforehand to avoid any last-minute hassles. Contact your lender to know more about the information and documents required for a loan against property.
Loan seekers can choose from a variety of credit choices. You can choose between secured and unsecured loan packages based on your needs. You can consider a loan against the property if in any case you are unable to apply for any other types of loans. A loan against property is a sort of secured loan in which you can pledge your property in exchange for a loan. You need to mortgage your property to get the loan amount. Bank will check the value of your property along with your eligibility for a loan against the property. If you qualify for the eligibility mentioned above, you need to do it after you have provided all the documents required for a loan against property.