Whether you are deciding to apply for a loan against property or are midway through your repayment, have a financial plan handy to be able to manage your EMIs effectively.
The loan against property tenor is usually lengthier than unsecured loans because of both the value of the security and due to the fact that your lender can count on the asset pledged. So, if you want to maintain regular EMI payments or want to make part-prepayments to reduce your interest obligation, then managing your loan efficiently is a must. Read on to know how you can manage your loan against property better.
Repay the Loan on a Timely Basis
When applying for a loan against property, along with comparing varied offerings on the basis of loan terms and interest rates, use the loan against property EMI calculator to plan your EMIs in advance. This will help you structure the repayment alongside your income. Additionally, it will also help you park aside some funds as savings to ensure you can meet urgent expenses without missing EMIs. Thus, you will be able to minimise the risk of paying EMI bounce charges or penal interest.
Save to make Regular Prepayments on the Loan
Making part-prepayments towards your loan against property will helps reduce your overall interest and thus your subsequent EMIs or loan tenor. So, plan to save money while you repay your loan in such as way so that you can make at least one prepayment a year. Once you get into this practice you can start increasing the value of your savings so that you prepay the loan faster and get debt-free in no time.
Choose higher EMIs if you can Afford it
Lenders offering a loan against property in India allow you to have a long tenor up to 18 to 20 years. But, the thing you should understand is that the longer the tenor, the higher your interest obligation will be. So, basis your salary hike, you can re-negotiate your EMIs with your lender every year. This will reduce your tenor, and thus save you money.
Refinance your Loan to get Better Interest Rates
If you are an existing loan against property borrower, you can choose to refinance your loan to take advantage of lower interest rates. This will bring down your EMIs and allow you to become debt-free faster. For example, you can apply for a Loan Against Property Balance Transfer with a trusted NBFC like Bajaj Finserv to get access to a nominal interest along with additional benefits such as Flexi Hybrid facility and a top-up loan. Simply check your loan against property eligibility before proceeding and ensure you transfer your loan in the first half of the tenor to save more.
Armed with these pointers you can check the loan against property eligibility and documents list to apply for a sanction of up to Rs.3.5 crore with lenders like Bajaj Finserv.