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WHAT ARE THE CHARGES ON LOAN AGAINST PROPERTY?

Posted on Monday December 14th, 2020

A loan against property is one of the most popular loans as it is easy to use and can serve as a needful source of financing. Therefore, in order to manage your finances efficiently, you must keep in mind about the charges applicable on your loan against property. It will give a clear picture about the total cost of taking mortgage loan and will help you to layout a budget for the repayment of loan. So, have a look on various charges that are applicable on your loan against property.

Interest rate: The rate of interest is the cost at which the particular financial institution extends credit to you. The calculation is made on the total amount that one borrows for the tenor for which he/she is taking the LOAN AGAINST PROPERTY and interest rate is calculated annually which is added proportionately to every monthly installment.

Processing fees: It is also known as application fees used to cover administration costs, credit check costs and property appraisals and so on. This amount will be deducted from the total borrowed amount before it is disbursed to the borrower.

Charges on statement: Most of the lender will charge you for interest, principal statements as well as loan statements that help you monitor the progress of loam. It is sent to you in the form of hard copy covering the cost of printing and sending them to you. You can avoid such charges by switching to online loan process. One such lender is ShubhBank, which offers digital lending platform and access to all loan related statements at your convenience.

Penal interest: In case you default a loan or fail to make EMI payments, you have to pay penal interest. It is calculated on a monthly basis and charged over and above the interest rate. So, it is advisable to plan your repayment in advance to avoid paying such charges.

Part prepayment charges: If you got a bonus or saved enough to make part prepayment towards the principal amount to repay the loan fast then lender may levy a prepayment charge. Before you APPLY FOR LOAN AGAINST PROPERTY ensure yourself to choose a lender with low or zero prepayment charges to make the most of it.

Foreclosure charges: It involves paying off the entire loan money in one go before the completion of the tenor. Likewise prepayment, foreclosing the loan also attracts a charge too. It is always good to choose a financial institution that has a low foreclosure charge to make repayment simpler.

Secure fee: Some of the lenders impose a secure fee to ensure security for your transactions and sensitive information in a manner they deem necessary. It is done to keep your online account and data safe.

Hence, whenever you are in need of loan against property, don’t choose just by looking at a low interest rate. Therefore, choose a ShubhBank which gives you ample funds at a nominal interest along with unhidden charges when you pledge your commercial or residential property with us.