A mortgage loan can be best described as the credit option which extends funding against a residential or commercial property as collateral. It is thus a secured loan option and is considered to be one of the feasible funding options to fulfil high-value financing needs.
Features of a mortgage loan
High loan value
Generally, this credit option extends a high loan value to eligible applicants. Notably, the amount sanctioned depends on the market value of the property in question and the creditworthiness of the applicant.
Simple loan eligibility
Usually, this loan option comes with a simple set of eligibility criteria. Most lenders consider individuals between the age group of 33 and 60 years with a stable source of income and a CIBIL score of 750 as eligible.
Typically, most lenders follow a simple documentation process for mortgage advances like a loan against property. Applicants are usually required to submit KYC documents, proof of address, proof of income and documents of the property to be mortgaged to initiate the verification process.
Quick approval and disbursal
Most financial institutions follow a quick approval process and disburse loan value within 4 days. This makes it a feasible option to meet essential financial requirements at the earliest.
Reasonable interest rate
The mortgage loan interest rate is relatively lower than unsecured credit options, which makes it easier to repay. However, factors like an applicants’ income, CIBIL score, the property’s value, etc. tend to influence it.
Usually, the repayment tenor for this loan ranges between 2 and 20 years. However, it may vary for salaried and self-employed applicants.
To make the most of this credit option, individuals should compare these features extended by different mortgage loan providers and pick the most suitable one.