Availing of a loan against your property is a safe choice when you require a large sum in a short time. As we strive to rebuild the economy in the post-pandemic era, now will be the ideal time for individuals to invest in expanding their businesses, start a new business, or work on monetary plans that have been on hold owing to almost the whole world staying at home.The emergence of new opportunities and the opening of markets will provide several options for individuals who want to use loans against property as a way to cater to their financial requirements. Below are a few tips that will help you get the lowest and most lucrative property loan interest rate. It may also help get your property loan approved at an affordable interest rate.
Maintain a high credit score: A credit score is a three-digit indicator that is assigned by credit reporting bureaus. It reflects how good the borrower has been with previous credit installments and acts as a measure to test how well you will perform on new and continuing debts. A credit score is based on several factors, including regular EMI payments, overall credit utilization, and low credit appetite among the other things.
If a borrower has a credit score that exceeds 800, you are likely to receive the best borrowing terms from any lender including the low interest rates. The credit score of an individual can impact the interest rates by 1.5 to 2%.
Wait for special offers: Another way to look for low-interest rate options when availing of a loan against property is to wait for a special offer. The festive season is filled with promotional offers and discounts, giving borrowers ample to choose from.
Also Read: Get Lower Mortgage Loan Interest Rates
Compare different loans against property lenders: Comparison shopping has long been a concept that has helped consumers and borrowers secure a competitive deal.
A loan against property is a product that has zero differentiation. Ensure that you research each lender well and take a note of what each stand to offer, and only then proceed to apply for a loan. This will save you the adverse impact of making repeated loan applications and will help you zero in on the lender who is most likely to approve your loan application.
Seek a lower NMI to EMI ratio: The NMI to EMI ratio plays a key role in all property loans. Net Monthly Income or NMI is what a borrower has after paying legal liabilities (such as income tax, EMIs, etc). Financial institutions and lenders set a cap on the NMI-to-EMI ratio to validate the quality of their credit customers.
Final ThoughtsConsider using the loan against property calculator, as it is an advanced online tool that helps compute monthly installments, interest payable, and the cost of the loan in seconds. It allows the borrower to adjust the loan amount as well as the tenor to arrive at an EMI outgo that will suit the individual. A mortgage loan calculator also reflects the LAP loan interest rates payable and a detailed look into the outstanding balance after paying EMIs, principal and interest component of EMIs, and so on. Hence, when you decide to avail of a loan against property, we recommend you review our tips to get the most lucrative property loan interest rate and use a calculator to get an estimate of the EMI outgo.