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Is It Economical To Take A Loan Against Property?

It is really economical to take a loan against your property. We understand that you think that this is a big loan, and that the risk can be too much. This is a common fear, not just in the case of loans against properties, but for most other types of loan. As long as a loan is a secured one, there is a risk of course, but you won’t need to worry about that since you’ll only be given the loan if you are deemed to be qualified for it.

That means that banks and other lenders shall make sure that you can repay the loan. This is beneficial not just for them, but for you too. You repay the money back on time and even get an increase in your credit score, and they of course don’t lose their money!

Now, a loan against property is also beneficial for you since it saves you a lot of interest. It is a secured loan, which means unlike the unsecured forms of credit, here you don’t have to pay a lot of interest. The interest rate is low. These come with long repayment tenures, which mean that you have a considerable time to plan your repayment. Tenures can be chosen according to your requirement.

Why are loans against property economical?

  1. Low interest rate: In these loans, the interest rate starts at 8.5%. The interest can increase in case of certain factors like the property’s value, the loan amount, and your ability to repay it.

  2. Minimal documentation: For loan against property, you need minimal documentation.

  3. Loan tenure: You can get loan tenure of as much as 15 years. Sometimes, you can get even longer repayment tenures. This is very good for those who want a longer time to repay the loan, which gives them the benefit of smaller EMIs.

  4. No income proof is needed: Here’s another huge benefit. You do not need to show your income proof. All you need is a viable property which is either in your name, or in the name of your spouse, children, and so on. Banks and other lenders do not typically check for income proof, which is a big boon for those looking for emergency money.

  5. You don’t need to show a credit score: As said above, the valuation of your property counts for more than credit scores and salary. This is actually beneficial for those with low credit scores, or for those without any credit score at all.

  6. Property safety: The property shall remain under the lender’s name. It shall be given back to you after the repayment is complete. 

Documents you’ll need for a Loan Against Property

1. Identity proof

•Aadhar card


•Driver’s licence 

•Voter’s ID

2. Address proof

•Aadhar card

•Ration Card

•Telephone Bill

•Electricity Bill

•Voter's ID Card

Other Documents

  • 3 Bank statements for the last 6 months

  • Pay slip or form 16 

  • Copies of all the property documents for the property that is to be pledged for the loan amount

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