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Growing your business quickly is a dream, but financial difficulties can sometimes become a hindrance to fulfilling this dream. Fortunately, banks and financial institutions offer various solutions, and one such popular option is to get a loan against property. A loan against property is a loan product in which you use your property as collateral. This means that you give your house, flat or land as security for the loan. The lender holds the property as a guarantee until you repay the loan in full. But you can live in or use the said property during the loan tenure.
LAP is a good option to grow your business
Jagdeep Malla Reddy, Chief Business Officer, Piramal Finance says, “A loan against property can be a great option to grow your business as it offers lower interest rates and higher loan amounts. However, it is important to evaluate all your options and choose the one that best suits your financial situation and business goals.”
The interest rates are usually low.
There are many benefits to using a loan against property for your business. First, interest rates are typically low, starting at around 8 percent per year, making the loan easier to pay off. Unlike selling your property, which means you lose ownership forever, a loan against property lets you retain your property while getting the money you need based on its value, your credit history, and your income.
Loan up to 65%
Non-banking finance companies (NBFCs) can lend up to 65 per cent of your property value, sometimes up to Rs 5 crore, giving you a lot of options. Also, monthly repayments are easy. This typically ranges between Rs 750 and Rs 900 per lakh borrowed, and some lenders also offer multiple repayment options to suit your business needs.
Use a calculator before choosing a LAP.
Taking a loan against property is a popular option for growing your business, as it offers several benefits such as tax exemption on interest and related charges paid under Section 37(1) of the Income Tax Act. However, before making any decision, find out the best option for your business and compare all the available options. It is also important to use tools such as a loan against property calculator.
What is loan against property good for?
In conclusion, a loan against property can be a great option for those who want to grow their business while retaining their assets. It is important to consider all the factors and choose the best option for your financial situation and business goals.