Loan Against Property Terms
A Loan Against Property is a secured business loan where property is pledged as collateral. This type of loan provides financing based on a percentage of the property’s value, with repayment tenures typically ranging from 5 to 20 years. Your Loan Against Property interest rate can be fixed or reducing, depending on the lender and the specific terms of the loan.
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What are the risks of taking a Loan Against Property?
Taking a Loan Against Property carries the risk of collateral loss if in you happen to default on your business loan. This will also have a negative impact on your credit score. Therefore, it’s important to ensure proper valuation and insurance of the property you’re mortgaging.
Taking a Loan Against Property carries the risk of collateral loss if in you happen to default on your business loan. This will also have a negative impact on your credit score. Therefore, it’s important to ensure proper valuation and insurance of the property you’re mortgaging.
Some benefits of Loan Against Property include lower interest rates with larger business loan sanction amounts, along with the luxury to repay over a longer tenure. This type of loan also gives you tax benefits on interest payments and helps you manage your high-value expenses conveniently.
The best time for a business to apply for a Loan Against Property is when you have a need for substantial business funds, such as for expansion, working capital, or debt consolidation, and when you have sufficient equity in the property to leverage as collateral. You should also consider the value of your property as a factor when making the decision to apply for a Loan Against Property
