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Enjoy Low-Interest Mortgage Loan Against Property

mortgage loan against property

If you own a residential or commercial property, you can use it to raise funds for the business. The property can be be in use, rented or leased but you need to have clear title. If there are co-owners of the property, they will become co-applicants for the loan. Mortgage loan against property application process is simple and straightforward. The loan is designed to help your business grow to new heights. No matter the type of business you own or the growth stage you are in, it is possible to use your property to get access to funds.

Also known as secured loan, the loan amount will be based on the market value of the property. So, you must estimate the current market value of the property you want to hypothecate. If you have an idea before you apply for the loan, you will be in a better position to negotiate the terms. When you make the loan application, the lender will hire a market valuer to estimate the market value of the property and the loan amount will be based on the same. No lender will extend a loan for 100% value of the property. They will offer a loan for about 60% value of the property. 

The loan application procedure is simple but several lenders have strict eligibility criteria you need to be aware of. You can compare the same online and check whether you qualify for the loan or not. Most lenders require you to have a business in existence for a minimum period of three years and it should be profitable. However, with mortgage loan against property, the risk is low. Since your asset is hypothecated with the lender, they can auction it to recover funds if you default in repayment. Hence, you can enjoy low interest on the loan but you need to be careful about making the EMI payment on time.

At the time of application, prepare a repayment schedule to be aware of the monthly outflows you will have to manage. You can prepare a schedule using an EMI calculator. The calculator is available for free online and it is very easy to use. If you have the loan amount in mind and a tenure you are comfortable with, simply use them as inputs and you will see the estimate in no time. Consider the inflow and outflow of cash before you agree on the EMI amount.

The biggest advantage of applying for mortgage loan against property is that you can use the funds for any purpose in the business. The lender will not ask you about the same and there are no restrictions with the end use. You can use it to introduce new machinery in the business or to expand to a new market. Since the loan has high amount, it is usually applied for incurring capital expenditure. Estimate the amount of funds you require and make a loan application against your property today. 

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