Also called Loan Against Property (LAP) is a loan that NBFCs, housing finance firms, and banks offer against private, commercial, or residential property. Often, you get these loans at substantially lower interests as opposed to personal or business loans and are paid out at a reasonable duration. Any self-employed or salaried person can apply for a bank loan private property singapore if they own any property. The size of LAP allocated in these cases is also greater in contrast to other loan options.
Why is demand for LAP is increasing?
More and more people owning properties are soliciting loans from HDB and banks these days. The finance experts usually credit this spike to three reasons, which are as follows:
- LAP is more economical than personal loans.
- You can use LAP for various purposes, like unexpected medical expenses, marriage, higher education of your child, or establishing a business, which is not feasible with personal loans.
- The ownership of the property remains with the occupant only even after the bank disburses the LAP.
On top of this, the existing clients of a housing finance firm or bank do not have to undergo the tedious document verification procedure again from the beginning.
Things you need to consider while taking LAP
Here are a few things you will have to keep in mind when applying for Loan Against Property (LAP) in the banks. This information will help you arrive at the best decision on whether to mortgage our property or not or think of another way out. Let’s dig in further!
Your loan application shall be sanctioned by the lender only after he is assured of your ownership of the property. And in case there is any co-owner, he will have to show up when asked as a criterion of getting LAP. On top of this, the loan allows longer repayment duration as opposed to personal loans. The EMIs of the loan are scattered over several years, and the interest rate also is low. A longer tenure implies that the EMIs will be small, which thus, lowers the payment burden you would have faced otherwise by the end of every month. The lender of LAP will gauge your repayment ability by scrutinizing your repayment records, ongoing loan, credit history, income statements, etc.
In a nutshell, bank loan private property singapore is a great option. Since, it provides immense flexibility, greater loan amount, the practicality of the end-use, low-interest rates, and lengthier repayment duration.