Major Factors that Influence Your Loan Against Property Eligibility – Know Here

Whenever an individual has to take a major step in life, it is very likely that they would require a strong financial backing for the move. This could be about making a transition from working in a corporate company to starting a new business venture, sending their kid abroad for higher studies, or even paying for a family member’s wedding. 

Whether it is a personal or professional reason, both could involve a huge amount of money. Now, not every individual would have the required savings to fall back on for these expenses. In such cases, they can always apply for loan against property. This loan is a great option since it is a multi-purpose loan, which means that the borrower can use the funds for any expense of their choice. However, before applying for this loan, it is very important to first be aware of the factors that impact your loan against property eligibility. This is to ensure that the lender can offer a good deal on the loan. 

So, here is a list of the major factors that are key in influencing your eligibility for a loan against property:

• Credit record 

Financial institutions always check their applicants’ credit records before approving any loan applications. Ideally, it is considered best to maintain a credit score of 750 or more. Lenders have been known to offer the best deals to those with good credit scores, such as a low loan against property interest rate, high loan amount, and even a suitable repayment tenure.

• Job stability 

If an applicant has a record of frequently changing their jobs, financial institutions might find their application to be a risk. This is because frequent job changes are an indication of unstable income, which can be a problem while repaying monthly instalments of a loan. So, make sure to work at a reputed company for a good tenure that establishes your job stability. 

• Repayment tenure 

The repayment tenure that a borrower opts for can also influence their loan against property eligibility. By opting for a long repayment tenure, the EMI amounts are going to be lower. Since this increases the borrower’s affordability, it decreases the lender’s risk. So, opting for a long repayment tenure can improve one’s eligibility for a loan against property. 

• Number of loan applications 

A lot of people do not know this, but financial institutions can track the record of loan applications that an applicant has previously sent. Getting too many loan applications rejected by multiple lenders is never a good sign, which is why it is advisable to avoid doing so. Make sure to apply for a loan application after completing your research on what the lender’s requirements are. 

Most financial institutions make it very easy for borrowers to apply for a loan against property. Just make sure to check with your lender about the loan against property documents that they will need. This is to ensure that the documentation process goes smoothly.