Repay Over a Longer Tenure
A key benefit of opting for a loan against property is the fact that you can repay it over an extended tenure. Depending on the lender, this tenure can last up to 20 years. This is especially helpful when repaying a large sum as it allows you to tailor your repayment by opting for suitable monthly instalments. The long tenure coupled with a low interest rate make it an efficient and affordable option to opt for. Usually, the repayment duration you can access is up to 5 years when it comes to an unsecured loan. If you borrow a high amount, this can result in hefty EMIs that you may find difficult to service every month.
Read Also: How to determine the ideal tenure of your loan against property
Get Tax Benefits on Interest Payments
Another standout feature of a loan against property is that it allows you to enjoy tax benefits on interest payments. However, it is important to note that these benefits apply only if you use the sanction for specific purposes. To help you understand when these benefits apply to you, here is a detailed breakdown. Here is how to save tax on loan against property given below:
Section 37(1) of the Income Tax Act, 1961, allows you get a deduction when you when you use the loan against property for a business purpose. You can obtain tax benefits on the interest paid and processing fees incurred by claiming the same as business expenses.
Similarly, you can also claim a tax deduction on interest paid under section 24(B) of the Income Tax Act, 1961, if you use the sanction to purchase residential property. The maximum deduction is Rs.2 lakh and you must provide substantial proof regarding the use of the funds, ensuring that they are in accordance with Section 24(B).
It is also important to note that you cannot claim tax benefits if you use the sanction for personal expenses such as education, travel, vacations, weddings, and more.
Manage All your Big-ticket Expenses Comfortably
A loan against property helps you manage big-ticket expenses comfortably. This is due to the fact that it offers a large sanction at a low interest rate and for a long tenure. Expenses such as renovation, home purchases, wedding decoration, overseas education and debt consolidation are examples of spends that would otherwise negatively impact your financial wellbeing if made out of pocket. Thankfully, the large sanction covers these expenses with ease. However, borrow prudently and only as much as you can repay, remembering not to compromise the safety of your collateral.
All the above-mentioned reasons are why borrowers across the country are opting for a loan against property over its collateral-free counterparts. Additionally, while unsecured loans have multiple eligibility terms you need to meet, secured options like this one making applying easy with minimal documents required. Besides these advantages, borrowing via this instrument can be even more beneficial if you opt for a lender that provides additional features. These add immense value to your overall experience and may even allow you to manage your cash flow efficiently.
The Bajaj Finserv Loan Against Property is one such option as it offers Flexi facilities and grants access to an online loan account in addition to its large sanction. Via the Flexi facilities, you can borrow as per your need and pay interest only on the amount utilised. You can also choose to pay interest-only EMIs for the length of the tenure and repay the principal at the end. This way, you can devote your finances to other obligations without any compromises. To enjoy all these perks, check your pre-approved offer for a tailored deal and enjoy hassle-free application.
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