Have a financial need? Get a mortgage loan

A mortgage loan, or loan against property, helps you monetise your owned property without having to sell it, and also retaining ownership rights.

Not for nothing does every person clamour to own a property of their own. Apart from the obvious advantage of providing shelter and security, a property to your name also helps you raise money against it, by way of loans or rental income. In case you don’t need a property, you can liquidate it and get back your invested money.

However, the best way to raise money against your owned property is to take a mortgage loan against it. You can try this option when you are in urgent need of funds.

What is a mortgage loan?

A mortgage loan, also known as a ‘loan against property’ is finance raised against the current market value of an owned residential or commercial property.

The loan amount is decided based on a few factors:

• Age of the property and current condition of the structure inside which it is located
• Current market value of the property
• If there are any current loans on it, for example a home purchase loan or a mortgage loan taken against it. The mortgage loan application will be rejected in both cases
• The loan applicant’s eligibility for the loan

Do check the mortgage loan interest rates across leading banks and housing finance companies before applying for it. The mortgage loan interest rate is normally higher than that of a home purchase loan. Also, its tenure is normally not over 10 years, depending on the lender.

The mortgage loan: A better alternative to selling your property

A loan against property provides a better alternative to selling the house to raise finances. Consider the reasons why:

• The mortgage loan helps you raise money quickly, since the lender only has to check your eligibility and the property in question.
• Though you take the loan, all ownership rights and titles on the property are still in your name. The lender does not assume full or partial ownership of the property after granting the loan. However, the property may be attached if you consistently default on repayments.
• The lender does not concern itself with the purpose for which you require the loan. It could be a personal or business need.
• However, the mortgage loan interest rate may be influenced by current market rates, and whether you have a good credit history or not.
• Leading housing finance companies are currently offering mortgage loan interest rates at about 9.75%, and they may also offer different floating rate slabs for different tenures (3, 5 and 10 years).