MORTGAGE LOAN / LOAN AGAINST PROPERTY

Overview

Mortgage Loan / Loan Again your Existing (Residential / Commercial Property) is a Term Loan where funds could be utilized for Meeting your financial Requirements. Financial Institutions / Banks do not monitor the End Use of the Loan but only tend to take a declaration as to the funds been utilized for meeting up the Business Requirements of could be used to meet your Cash flow in you existing Business. LAP / Mortgage Loan could be termed as a Secured Term Loan / Personal Loan which could be availed by the ways of setting a Mortgage to your Existing Property and utilizing this fund for meeting up your Personal Needs like Marriage, Business, Higher Education, Hospitalizations and many more.

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Features

Product Overview

Ready Constructed Properties such as Flat / Shops / Office Premises

Properties could be Self Occupied /Rented/ Vacant

End use of the funds are generally not monitored by the Financial lender and it could be utilized for any kind of family may be Medical Treatment, Business Expansion, Higher Studies and any other

Funding

Maximum funding Limit is Restricted to 70% of the Assets Value.

Criteria

Applicant can apply Loan on his Individual capacity as well as he could jointly take other Property Owners as Co-Applicant.

Quantum

Maximum Tenure of 15 Years depending on the other parameters as well as restricted to Bank’s Policies & other criteria norms.

CIBIL Score

Financial Institutions and Banks will check the Credit Report which is downloaded from Credit Bureau of India Ltd website to understand the applicant’s & co-applicant’s past repayment history and also to understand the existing Loan obligations serviced by the Individual. Based on this past History and Loan Obligations, the Financial Institutions finally appraise the said proposal for final sanctioning. Based on the Cibil score, the final Loan interest rates could also vary.

Mortgage Loan Eligibility Norms

Loan Sanction Criteria varies based on the Profile.

If you are Salaried Individual the calculations normally done based on consideration of your take Home Salaries/ Net Salaries which is credited to the bank. Tentatively the range is around 45%-55% of your Salary Credit. Which could vary with respect to Financial Institutions?

For Self Employed the Calculations are Normally done based on different methods which Include Income declared as per the Latest Financial returns filled, Bank Statements, GST Returns, Gross Turn Over Products But it is Normally restricted to Fixed Obligation to Income Ratio Norms (FOIR).

Rate of Interest

Interest Rates vary based on the Profile of the Customer, Cibil Score and it also depends on various other Parameters such as Eligibility Criteria under which the Proposal has been sanctioned. Interest Rates could either be Fixed / Floating/Semi Fixed and may vary between the Banks and other Financial Institutions. Lesser the Interest Rate, Lesser would be the EMI charged which could in turn Increase the Loan Amount proportion.

Mortgage Loan Processing Fees & Other Charges

Apart from Mortgage Loan Interest Banks and other Financial Institutions will charge a Fixed Nominal Charges which normally needs to be paid at the time of Loan Processing. While making your comparisons make sure you also consider these charges. Below are details of this charges which are normally paid at the time of Loan Disbursement

Processing Fees

While processing your Loan Application Bank Normally charges you a Processing Fees this is considered to be Non refundable and the charges are likely to vary with different Banks. For Salaried Individuals, normally varies within the Range of 0.75 to 1% and for self employed it varies from 0.75 to 1.5% based on the Loan Amount. Normally your Legal & Technical Charges are actually included within this fee. But a few Private Banks & Financial Institutions do charge Legal & Technical Fees separately which is quite nominal.

Loan Insurance

In Order to Secure the Loan Proposal, the Bank provides a Loan Cover in order to secure the Loan. Cover could be of Different types in order to reduce the premium amount such as Accidental Death Cover or Complete Loan Cover due to natural death. The Insurance amount is added to the Loan Amount which indirectly increases the EMI amount.

Franking Charges & Notice of Intimation

While Executing the Loan Agreement between the Financial Institutions and Customer. The State Government normally charges a Nominal Stamp Duty which the Customer needs to bear along with the Legal Fees during execution of the Loan Agreement.

Post Loan Disbursement

Customer needs to be aware of the below charges which could be charged: –
1) Cheque / ECS Dishonour Charges
2) Penal Interest Charges
3) Rate Conversion Fees
4) Duplicate Loan Statement & Other Related Documents

Preclosing Charges

For Individual Mortgage Loan Borrowers as per the RBI norms, the Preclosure Charges if the borrower utilized in an Individual Capacity other then Business use could be 0%. However at the same time, if the utilization of funds is specifically for meeting up your Business needs and if the Company / Firm has been taken as a guarantor or if is a part of this Loan structure then the Preclosure Charges may vary between 4 to 5%.

Mortgage Loan Documentation Details

Below Documents need to be submitted along with your Loan Application:

Documentations:
  1. KYC Documents
  2. Income Documents
  3. Bank Statements
  4. Existing Loan Details
  5. Property Documents
Above List could vary based on the Banks and other Financial Institutions and solely depend on the Final credit approval provided any additional documentations required for final credit assessment.

Tenure

As mentioned earlier, the maximum tenure an Individual can apply is for 30 years. It is always subject to Credit Norms and the loan terms which is finalized could be reduced on the sole discretion of the Banks and other Financial Institutions.

Property Funding Criteria

Value of Funding is further derived from the Property Value or the Market Value whichever is lower. As per the RBI guidelines, higher the Loan Amount, lower the proportion of funding which is as mentioned above.

Balance Transfer Option

In case of Existing Mortgage Loan / Loan Against Property, there is an option of transferring the Loan to an Another Financer and we could also enhance the amount as a Top-up which based on the End Use of the Loan could be sanctioned. End Use could either be meet your Cash flow in your existing Business or for meeting up your Personal Needs like Marriage, Business, Higher Education, Hospitalizations and many more. Eligibility Calculations would remain same based on the other Loan Obligations. This is could also facilitate in reduction of Interest Rates which could be quite beneficial while transfer is concerned.

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