The economic downturn caused people to either lose their jobs or shut down businesses. In such a time of crisis, when lending corporations discontinued offering unsecured loans, mortgage loan proved to be a saviour.
Prospective borrowers intending to fund their financial emergencies through this credit facility should know what is mortgage loan and learn about the top tips to secure the best mortgage loans.
12 points to get the best mortgage loan deal online
A mortgage loan is sometimes referred to as a loan against property. Customers can follow these tips to secure the most suitable mortgage loan as per their requirements.
1. Know about the different types
Before even choosing a lender, applicants must know about the different variations of mortgage loans available in the market. Leading financial organizations provide 3 types of loans against property. They are loans-
- Against residential or commercial property
- For buying commercial property
- For lease rental discounting
2. Compare mortgage loan interest rates
Prospective applicants should compare the mortgage loan interest rate offered by different lenders to get the best possible deal. In addition, they must also check out the benefits lenders extend against loans against property.
3. Meet eligibility criteria
Qualify for loan against property by meeting the simple eligibility criteria, including
- Residing citizen of India
- Age limit between 28 to 60 years (for salaried applicants) and 25 to 70 years (for self-employed applicants)
- Steady income source and more
4. Provide necessary documents
Another important pointer to consider is the documents essential to obtain a mortgage loan. Different lenders demand a different set of credentials to confirm the repayment capacity of a borrower. A few among them are-
A. KYC documents like-
- Voter card
- PAN card
- Aadhaar card
- Driving license etc.
B. Income documents related to-
- Income tax returns
- Bank statement of last 3 months
- Latest salary slips
C. Photocopy of property documents that is to be mortgaged
D. Passport-size photograph of the applicant and others
5. Application process
Prospective borrowers should know how to apply for mortgage loan online to avoid unnecessary hassle. To start with, applicants can download the online application form from their lender’s official websites.
In this respect, reputed NBFCs provide pre-approved offers to streamline the application process. These offers are available on financial products such as home loans and loans against property. Applicants can check their pre-approved offers by providing names and contact details.
6. Make sufficient down payment
By offering higher down payments, one can lower the EMIs to make the loan affordable. Even for those who cannot make a down payment, there is zero down payment loan facility available. However, only borrowers who are confident to afford timely repayments must opt for this option.
7. Maintain impressive credit score
Applicants must try to maintain a credit score above 750 to acquire the best mortgage loan deal. A higher credit score helps to bring down interest rates significantly.
8. Use an online mortgage loan calculator
An online mortgage loan calculator instantly provides accurate results regarding the EMI of a specified loan amount and interest rate.
- Consider the tenor
Lenders determine the tenor of a loan against property based on the employment status of the applicant. For instance, if an applicant is a salaried individual, he/she can opt for a tenor up to 20 years to make repayments conveniently.
- Know about the hidden costs
Applicants must look for if there is any foreclosure or pre-payment fees involved for the loan.
- Confirm no involvement of encumbrances
Individuals must ensure that there are no disputes with the property that is to be mortgaged. Besides, applicants have to provide all essential documents the lender asks for as evidence of property ownership.
- Look for loan against property balance transfer with top-up facility
Several NBFCs extend balance transfer facilities against minimal documentation to ensure swift processing and a high-value top-up loan.
Apart from these, while choosing a mortgage loan plan, read in between the lines to get clarity regarding the terms and conditions to utilize the fund appropriately.