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Loan Against Property or a Personal Loan- which One is Better?

A loan against property is a secured loan that can be against a collateral property to procure a substantial loan amount. On the other hand, a personal loan is a go-to financing option for most Indians when they require emergency funds.

One of the primary benefits of both personal loans and property loan is no end-usage restriction and easy availability. However, a very high CIBIL score of 750 or more is required to avail personal loans. Alternatively, you must know how to increase the CIBIL score to gain access to various financial advances conveniently.

Loan Against Property or Personal Loan- the More Viable Option:

As loan against property is a secured advance, a financial institution keeps a mortgage property while sanctioning the funds. In case you default, the lender can liquidate the property to recover the outstanding debts. This proves beneficial in terms of availing a loan for low CIBIL score.


Take a look how a loan against property proves advantageous –

  1. Higher Loan Amount- With a low credit loan like personal loan, you only have access to Rs. 25 Lakh, whereas, you can procure up to Rs. 3.5 Crore in case of a loan against property.
  2. Longer repayment Tenure- With a loan against property, you get an extended repayment tenure of up to 20 years. This lowers your monthly outgo to a significant extent.
  3. Lower Rate of Interest- One of the leading benefits of loan against property is the comparatively lower interest rate than unsecured credits like personal loans.

So, if you are wondering, how I can borrow money with bad credit score, you can obtain a loan against property for its diverse benefits.

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