property loan

Things to Follow to Get the Best Property Loan


A property loan is an affordable way to access funds right when you need them. This is a secured loan, and you are pledging your property with the lender in exchange for a loan. As you are pledging your most valuable asset with a lender, it is imperative to be cautious with such loans.

We introduce to you some of the dos and don’ts when it comes to availing of a property loan.

Things you Must Do While Applying for Property Loan


Choose a Reliable Lender

It is essential to choose a reliable lender to avail of a loan from. If you do that, you will be rest assured that they will take care of the papers of the property that you pledge as security. If you think there is a risk of misuse of documents, walk out of the deal right away. No matter what rush you are in, to avail of a loan against property, never consider risking your most important asset to any unreliable counterparty. Moreover, reliable lenders offer lucrative loans against property interest rates.


Maintain your CIBIL Score

Most individuals wrongly think that a high CIBIL Score is the only loan against the property eligibility requirement to secure a loan and that they can let their score slide after they have availed of the loan. It is essential to remember that credit instruments are linked to credit scores. If you are paying the property loan EMIs on time, but allow other loans to slide, it will hit the property loan interest rate too. Always make sure that your CIBIL Score remains high and preferably above the minimum.


Keep Some Loan Amount Aside for an Emergency 

Just like other loans, it is a good idea to keep aside some money from the loan amount. This should help cover a few months’ EMI in case of unseen scenarios. Financial experts typically suggest keeping aside EMI of up to six months with you and at the least, two months of EMIs as an emergency fund any time.

This will save you when there are delays in salary, job loss, or other problems which could hinder income flow. Remember that the money you keep aside is for an emergency. Pending car insurance is not an emergency; you must plan ahead of time for it. Only in situations where income flow is hampered, should you use the emergency fund to cover EMIs until you resettle.

Keep Yourself Aware of Loan MITC

MITC (Most Important Terms and Conditions) is something lenders prepare meticulously and mandatorily share when they deliver loan agreements. However, almost no one bothers to read the MTC. The MITC contains details of conditions related to loan repayment, loan foreclosure, pre-closure, property repossession, and other things. If you go through the MITC document thoroughly, you will not need to call up customer care and wait for them to solve the typical queries you may have.

Things you Must Avoid in case of Property Loan

Do Not Overstep Your Planned Monthly Budget

If you ever avail of a loan, you will feel the stress when it comes to repaying the money. One great way to stay safe from this stress is to plan out your monthly budget and try to stick to it. Remember that if you do not dictate your money and show it where has to go, soon it will begin telling you where you would go. Make your budget, provision EMIs, expenses, and stick to it. You can also consider using a property loan calculator to plan your finances.

Avoid skipping EMIs

You have availed of a property loan and have to pay it off in EMIs, but several times, you may be tempted to skip paying your EMI. Never allow yourself to fall into the trap of this temptation. Even one miss will incur a significant penalty, and it will also result in a blow to the credit history and score. Budget for EMIs and pay them promptly. Never skip EMIs.


Do Not Give Your Original Documents to Anyone

It goes without mentioning that identity is one of the most important things in life. Every day, many individuals become a victim of identity theft only to find out that they are responsible for something they have not done. We suggest you keep original KYC documents handy and with you and handle cancelled copies. Do not permit anyone to take photos of your KYC documents.

Do Not Fall for Advanced EMI Traps

Many times, property loan representatives will try to explain how you can save interest if you pay advance EMIs. Unless you have, in advance, spent part of the principal property loan amount, you will not be entitled to any benefit. Advance EMI is paying the next month’s EMI ahead of time. Keep the money and you can earn significant interest on it. Unless you are paying off part of the principal amount in advance, it is best to save the EMI amount as your emergency fund.

Additional Read: Top Free Amazon Tools To Help Sellers Boost Sales & Earnings

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