Why Taking Loan against Property a popular way of taking loans
by Finway FSC Empowering People FinanciallyWith
numerous ways of taking loans from the bank and other financial institutions, Loan Against Property is the most
popular. The reason why this way of taking a loan has become relatively popular
is because one can get a large sum of money. Once they mortgage the property
with the bank, the bank gets a security against the loan amount. This makes the
bank at a minimum risk of losing any money. Hence, banks prefer to extend a
loan that comes with security.
This
makes people invest money in property as they can get a large sum of money for
various purposes such as for Business Loan in Delhi
or any other city where the loan is taken from or building another property.
Mortgaging property helps one come out of tough situations too when there
is no liquidity. This way one can also liquidate the assets. Banks prefer to
give this loan without much paperwork, this eases the process for the bank as
well as for the customers.
Another
aspect that has allowed people to take such loans is the low-interest rate.
Low-interest rates do not become heavy on people who have fixed income,
enabling them to save parts of their salary/income. So although you mortgaged
your property, but you have received a large sum of money on a rather low
interest. You may use this money judiciously to multiply the money if you have
taken it as a Business Loan in Delhi,
Bangalore or some other city.
The
banks extend this loan and the amount is based on the market price of the
property. If the property has a bigger value, the loan amount will be up to 70%
of the money as a loan. The remaining money stays with the bank as the margin
money. This is the security that the bank takes in case one fails to pay the
loan amount back. Moreover, this ensures that the banks are safe against any
ups and downs of the market.
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Created on Oct 29th 2019 05:42. Viewed 625 times.