Read these pointers before applying for a loan against property

Individuals planning to secure loans against property must consider few pointers like eligibility, documentation, LTV ratio, and more. These considerations enable borrowers to avail a seamless application procedure. Therefore, to apply for loan against property, reading through the following points is necessary. 

1. Property value: For a successful loan against property application, borrowers need to mortgage their properties. Lenders decide on a particular loan amount by evaluating the pledged property’s market value or Loan-To-Value ratio. Therefore, it is vital to consider a property’s value before applying for loans. Moreover, a loan against property calculator feeds information like property value to calculate the maximum loan amount one can avail. 

2. Property’s location: A property’s value varies depending on its location. Therefore, factoring in the location before the loan application is vital. 

3. Loan against property eligibility: As a secured financial instrument, the eligibility requirement for a LAP is minimal. However, lenders check borrowers’ eligibility before sanctioning them the loan amount. So, potential buyers must scan through these criteria prior to the loan application. 

4. Documentation: There are different sets of eligibility criteria for salaried and self-employed individuals. Similarly, they need to present relevant documents depending on their income, business, and more. Thus, knowing about the documents required for a loan against property is important. 

5. Tax deductions on a LAP: As LAPs are an expense towards the required objective, borrowers need not pay tax on their loan amount. Rather they benefit from tax deductions on their repaid amount if they invest in home purchases, renovations, and repairs. 

Additionally, one can secure a loan against property without income proof if they possess a high credit score. 

Hence, one can apply for loan against property upon following the above pointers.