Need to start a new business? Want to get the higher education of your child? Is medical treatment costly? Which you will not be able to afford, a LAP Loan may be your most feasible option as it offers ample finances. You can avail this loan by pledging your property with a lender. The lender will sanction a loan as a certain percentage of the market value of the property. Now that you know how to apply, compare different mortgage loan interest rates and select the one with the lowest interest as well as other beneficial features.
The Reserve Bank of India has left the repo rate unchanged at 4% in 2021, consequently keeping the interest rates down on various credit types. This decision indicates a plausible time to avail high-value credit forms like LAP.
Since a LAP loan offers a substantial amount against affordable interest rates, lenders set certain eligibility parameters that borrowers need to fulfil to avail of the advance. Scrutinising an applicant’s personal and professional capability, the financial institution approves the loan amount.
This lengthy process can be streamlined by taking the help of a loan against property calculator. This free online tool helps a potential applicant understand his/her borrowing eligibility within seconds.
How to use a LAP calculator with ease?
Individuals planning to avail of a LAP need to understand the basic EMI and interest obligation changes with tenor selection. Ideally, a loan against property EMI calculator helps understand these differences by allowing users to tweak the data multiple times.
Here are the simple steps to use a LAP calculator that helps an individual determine the best borrowing option suiting his/her repayment capability.
1: Select the LAP EMI calculator tab on your preferred website.
2: On the redirected page, enter the loan amount and tenor.
3: Select the property loan interest rate offered by the lender.
4: The results are displayed instantly after the data is entered. One can find the monthly EMI, total interest payable and payment in the result section.
Using this mortgage loan calculator further removes the errors of manual calculations. Moreover, an individual can evaluate the repayment amount and start saving accordingly. Hence it is one of the smartest ways to ensure that one does not default on loan against property repayment.
Apart from evaluating the EMI and interest structure, potential borrowers must be aware of the factors that determine the mortgage loan rates and eligibility.
Factors that affect the mortgage loan eligibility
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Income
A borrower’s income is a crucial factor that substantiates his/her repayment capability. Thus, lending institutions assess this parameter before deciding the loan amount. Typically, a salaried employee with a stable income is deemed to have a high repayment capacity.
Hence, before applying for an education loan or LAP, it is imperative to check the minimum income specified by lenders.
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CIBIL score
CIBIL and credit report are the two essential scrutinising factors. Lenders assess a borrower’s repayment history before approving the credit application. Maintaining a 750+ credit score ensures timely repayment and removes the concern of defaulting. Again, keeping a good relationship with lenders also comes in handy while negotiating the reduced mortgage loan interest rate.
On the other hand, having a poor or no credit score would lead to the cancellation of a loan application.
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Fixed income to obligation ratio
Lenders also take into account a borrower’s monthly obligations based on the FOIR. This helps them to scrutinise an individual’s disposable income utilised to repay the outstanding debts. Therefore, maintaining a low FOIR would make an applicant more eligible for a loan against property.
Moreover, they would easily find lenders offering additional benefits on the said credit. Many HFCs provide pre-approved offers to make the application process quick and hassle-free. These offers can be availed on financial products such as home loan, LAP. Check your pre-approved offer by entering only basic information like your name and contact information.
These offers will help them avail of education loan against property without going through lengthy application procedures. In this regard, one must know that mortgaging a residential property would boost up the loan eligibility.
Interested borrowers can easily avail of substantial credit against mortgage loan by meeting all eligibility requirements. However, they must keep a tab on updated rules and things that one needs to know before applying for a loan against property to make an informed decision.
Nonetheless, if confusion prevails, one can use a loan against property calculator and get rid of borrowing concerns.
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