Buying a home is every individual’s dream but getting approved for a home loan isn’t everyone’s cup of tea. With so many eligibility terms to qualify, it only makes sense for those who know beforehand about loan against property eligibility to even think about applying for the same. Other potential loan applicants who know their loan eligibility is not up to the mark should look for alternative solutions to procure funds for purchase of property.
The alternative solution should offer ample amount to make the purchase of a residential property possible, the repayment time offered with loan should be high enough, and the interest rate should be pocket-friendly if not low. Taking all that into consideration, loan against property is the only debt product which fits the bill. Thus, if you don’t get approval for a home loan, resort to loan against property to obtain the necessary finances.
The advantages of using a loan against mortgage for buying a home are:-
You won’t lose your home if you fail to repay it: All mortgage loan including home loan comes with the risk of losing the mortgaged property if the debt is not paid. Thus, in your case you would have a certain advantage - even if you fail to repay the debt you’ll still have your house with you.
You’ll acquire higher profits if you sell the house: People who buy a home using a home loan pay double or more than the actual price of the property to finally own it. Thus, in order to acquire even a little profit on resale of the property they would have to resell it nothing less than 2.5 times the original value of the house. Again, the same won’t apply in your case.