Should you be taking loan against property?

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Should you be taking loan against property? One
of the biggest dreams that people have in their
life is to get their own home. Earlier, people
had one ancestral home and families lived there
generation after generation. But now, that the
families have become nuclear due to urbanization
and commercialization everyone needs their own
place to stay. Since the prices of real estate
are skyrocketing every year, it is almost
impossible to be able to buy a home from
savings. Therefore, the only viable option is to
take a home loan in Delhi or anywhere else in
the country. Yet, despite the many benefits of
loans, there is still considerable stigma
attached to taking loans. Let us try to
understand the importance of loans and debunk the
myths surrounding them. A feeling of
fulfillment After you successfully acquire a home
loan in Delhi, you are overwhelmed by this
feeling of utmost satisfaction and
gratification. Getting their own house is one of
the biggest achievements an average person can
hope for and if loans help them achieve their
dreams, then there is nothing wrong with the
process. There are tax benefits The Indian
government has taken a lot of steps to encourage
more and more people to invest in real estate as
it is one of the greatest contributors of GDP in
our country. One such measure is tax deduction
on the interest as well as deduction on the
principal amount of the loan. Naturally, with
such lucrative offers, more and more people are
motivated to get a home loan in Delhi and other
metro cities in the country. You should,
however, remember that you cannot claim the tax
deduction if the property is under
construction. Freedom from prepayment charges In
unsecured loans, the borrowers have to pay
prepayment penalties, but loans against property
are free from such overcharges. This also means
that if and when you have excess capital, you can
make a partial payment towards your mortgage and
reduce your burden of paying excess
interest. What is a loan against property? Loan
against property has become a common term these
days. In its process of disbursement, it isnt
much different from any other kind of loan. The
major difference, however, is that it is acquired
by pledging your residential or commercial
property as collateral to the lending
institution. Since it is a secured loan, which
means that it poses no threat to the lender, it
is made available at lower interest rates, and
is disbursed without excessive probing and
investigation into your documents. However, the
lender may still check your savings, annual
income, employment track, and other related
documents, so be prepared with them. At the end
of the day, the important thing to keep in mind
is that taking loan isnt something to be
stigmatized and banks arent something you should
be afraid of. Obviously, it would do you well to
be cautious and careful. And always remember one
important thing never take more loan than you
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absolutely have to. The reason is that regardless
of the fact whether you spend the borrowed money
or not, youll have to return every penny and
with interest! So it isnt wise to borrow more
than what is needed. Careful planning can go a
long way in saving you a lifetime of headache.