Top Advantages Of A Loan Against Property Over Collateral-free Loans - Loan Trivia


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Wednesday 10 August 2022

Top Advantages Of A Loan Against Property Over Collateral-free Loans

loan against property in India

Basically, there are two types of loans available in the Indian financial market, namely secured and unsecured loans. Secured loans require a property to be kept as a mortgage. While unsecured loans do not have such restrictions. 

However, there are several benefits of availing of a loan against property in India. In this content, we are going to see those advantages. 

Advantages of loan against property over collateral-free loans 

Some of the primary benefits of a loan against property over a collateral-free loan are as follows: 

  • Get a sizable loan amount: As loan against property requires keeping a property as collateral, the risk factor for the lending institutions is minimised. Hence, borrowers can obtain a sizable amount using this facility. 

  • Enjoy an extended repayment tenor: Financial institutions offer long repayment tenors as the disbursed amount is secured with property. The lenders can dispose of the property and recover the unpaid dues in case of a credit default. 

  • Avail lower interest rate: Lenders provide loan against property at an affordable interest rate. This helps the borrowers to plan their financial goals accordingly. Further, candidates can easily check their monthly instalments using an online loan against property EMI calculator

  • Obtain tax benefits: According to Section 37(1) and 24(B), borrowers can claim tax benefits for the interest paid for loan against property. 

  • No end-use restrictions: Individuals can use the obtained loan amount for their professional as well as personal purposes without any restrictions and obligations. 

Hence, these benefits make a loan against property in India a better choice than collateral-free loans during financial emergencies.

Also Read: Top Factors That Affect Loan Against Property Eligibility

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