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Loan Against Property
When bank or NBFC provides loan to the borrower against his property is called loan against property. It is like personal loan where loan amount can be utilized by the borrower to fulfill his personal or business need but there are various differences between the personal loan and loan against property for private financer in Delhi, which are as follows:
Rate of Interest: Personal loan is an unsecured loan so bank or NBFC charges high rate of interest on personal loan. Personal loan rate of interest offered by bank or NBFC ranging from 10% p.a. to 30% p.a. depends upon profile of the customer and his credit worthiness.
Loan against property is a secured loan which is secured against property of the borrower so lender charges comparatively low rate of interest. Loan against property rate of interest offered by bank or NBFC ranging from 8.50% p.a. to 18% p.a. depends upon profile of the customer and his credit worthiness. Loan Tenure: Personal loan provided by the bank or NBFC for shorter period of time i.e. 1 year to 5 years.
Bank or NBFC offers longer period of time for repayment of loan against property. Loan tenure for loan against property at lowest interest rate is in between 3 years to 15 years. Even 20 years also offered by some bank or NBFC.
Loan Amount: As the personal loan is an unsecured loan so bank or NBFC imposed capping on the loan amount. Bank or NBFC provide up-to Rs. 50 lacs under personal loan.
EMI: EMI calculation depends upon three factors i.e. (i) Loan Amount, (ii) Loan Tenure, and (iii) Rate of Interest. Due to lower rate of interest and longer repayment period, EMI on loan against property is lower than personal loan.
