A loan against property is a kind of secured mortgage loan that provides many benefits, such as low interest rates, minimal documentation, relaxed eligibility, a high loan amount, an extended repayment term, quick approval, and many more.
However, you need to fulfil the loan against property eligibility criteria to get these benefits.
The following factors determine your eligibility.
Property
The first requirement for a loan against property is that the property be residential or commercial. You may also mortgage a plot of land to avail of this loan.
The property you wish to mortgage must be freehold and vacant, self-occupied, or rented. Your lender will keep the original documents until you repay the final EMI.
You may continue living in the property for the entire loan term.
Age
The borrower's age is another major factor determining a property loan's eligibility and interest rate. Any Indian citizen can apply for a loan against property, provided their age is over 18.
The borrower must be under 60 (if salaried) or 65 (if self-employed) at the time of loan maturity.
Credit Score
A borrower's credit score plays a deciding role in loan against property eligibility. Generally, 800 is considered a decent score. However, you can apply for a loan even if your credit score is less than 800.
The applicable interest rate might be a little higher, though.
Besides the factors mentioned above, factors such as the borrower's nature of income and relationship with the lender also influence the loan against property eligibility.
Keep these points in mind when applying, and reach out to your lender if you have queries!
Read Also : What Are Mortgage Loans And How Do They Work?
