When it comes to personal assets, property is deemed to be extremely profitable, considering how you can lease it to generate income. However, this method is slow and ineffective if you require funds for a particular pressing need. In this scenario, you have two options to choose from: either sell the property or pledge it as collateral for a loan against property. The latter is a far more superior option for two reasons: the loan against property instant approval feature gives you a large amount of funds quickly, while allowing you to retain ownership of your assets.
Now that you’ve understood how your property can serve your interests, here are the steps to go through to apply for a loan against property in India.
Check your credit score
Your credit score is crucial to loan application as it indicates your creditworthiness. It gives lenders an insight into your financial health and repayment abilities. Having a score of 750 or more puts you in an advantageous position. It defines you as a creditworthy individual and helps you get approval for a loan with favourable terms. You have to meet the criteria for minimum CIBIL score required for Loan Against Property for easiest approval. Hence it is important to check your score beforehand and make amends if necessary. You can do so by clearing smaller debts or by securing higher income.
Choose the right lender
Selecting the right lender is key to getting the maximum benefits from your loan against property. This is because you can enjoy additional features along with the sanction. For instance, Bajaj Finserv Loan Against Property not only gives you up to Rs.3.5 crore as a sanction, but also allows you to benefit from the unique Flexi facility. Thanks to this feature you can borrow money from your sanction multiple times, in part, to fund your needs with ease. This negates the need to apply for a fresh loan each time you need funds and better yet, you’re only charged interest on the amount you utilise. Further, this loan has a speedy disbursal time frame and you can have the full amount within 4 days of approval. To make repayment easy, you can enjoy a flexible loan against property tenor of up to 20 years.
Meet the lender’s loan against property eligibility criteria
It is a must to qualify for a loan basis its eligibility terms before applying. When it comes to loans that offer a large sanctions, lenders are strict with following eligibility protocols. Typically, you’re required to be a salaried individual aged between 25 and 58 years. Also, you must work at an MNC or public/private organisation and own property in a city that falls under the lender’s list of approved locations. You’re also required to maintain a minimum annual income but this amount varies according to the lender and the city you reside in.
Gather the required documents
Loan against property documents required are an extension of your eligibility. These need to be accurate and up to date, as any mismatch is sure to slow down approval. Typically, you’re required to produce the following documents.
- Identity proof: Aadhaar card, voter’s ID, PAN card or passport
- Address proof: Electricity bill or phone bill
- Income proof: Bank statement of salary account and 6 months’ salary slips
- Property ownership proof: Title deed, sale deed and latest maintenance bills
Ensure legal clearance of collateral
Legal clearance comes in to effect when you’re pledging your property as collateral. If your property is under dispute, it can lead to rejection, so proceed with caution.
Submit the loan against property application
After having adhered to other steps, you’re ready to submit your application. Some lenders allow you to submit a loan against property apply online application for added convenience. However, you can always opt for the offline application method if you wish to Irrespective of the mode of application, include all your details in the form and submit the necessary documents.