Reasons to Use a Loan Against Property for Long-Term Business Goals

As an entrepreneur, there are several reasons you began your business and several more that keep you running it. Some people have long term goals like health, happiness, and money. Certain other people have freedom of time, holidaying, and family time as priority for long term goals. One of the most common objectives that business owners have is the educational success of their children. From graduation to studying abroad, further studies require quite some financial investment. For this, you can opt for a loan against property for education.

With suitable interest rate options and comfortable loan tenures, you can realise your long term business goals with a loan from a favourable lending institution. This article explains why a loan against property for education is a good choice.

What is Loan Against Property?

A loan against property is that loan for which you pledge any existing residential property or real estate establishment as collateral. Such loans are called secured loans. You can avail a loan amount for up to 70% of your property’s market value and although the lending institution has taken it up as collateral, you can continue using it as it was. Only during times of default will the lender turn to exchange the property in the market to make up for losses.

Must Read: 6 Rules to Follow While Applying for a Loan Against Property

5 Reasons How Loan Against Property Works For Education

External financing for fulfilling your purposes can be beneficial if you want to hold back from exhausting your savings. Here are 5 reasons why taking up a loan against property is a sensible decision:

1. For a loan against property, you can avail principal amounts for up to even INR 5 crores*. This is because the funds you can borrow are calculated against the market value of your house, bungalow, residential flat, or commercial space according to the market equivalent at that time. Such a lump sum amount can be advantageous for plans like business capital requirements, marriages, medical expenses, etc., especially for further education.
2. When you take up a loan against property for education, be it residential or commercial, you can take the loan for a tenure of up to even 15 years. This means that you can comfortably choose the EMI system for repaying the loan, without any burden on your wallet. You can use a loan against property EMI calculator to figure out your monthly expenses.
3. Loan against property interest rates are competitive. The exact rate will depend on the applicant’s creditworthiness, income, current debt, financial situation, the value of the property, the type of property put up for mortgage, and so on.
4. One major advantage of this type of loan is that the funds transferred from the lending institution into your account are not monitored. That is, you can use the money for any degree or course of study under any institution of the world. You can even travel abroad for study with this financial security. Thus, a loan against property gives you freedom of expenditure.
5. The most common reason why people choose a loan against property for education is that they don’t lose ownership of the property. You can still continue using the place as you were before giving it as collateral security. You can continue collecting rent from it. You can give it out as office space. You can continue residing in the apartment too. This means that you need not compromise on your long term business goals due to a loan.

Conclusion

The main 3 goals of any business owner are typically financial security, family health, and his/her children’s education. If you are an entrepreneur yourself, you can turn to SMFG India Credit’s loan against property provision to take care of your long term business goals. Check out the documents required for applying and apply as soon as possible. Moreover, you can check the eligibility criteria to realise whether or not you can apply for the loan.

With all steps online, you can take advantage of this loan from the comfort of your home. The interest rates are low and tenures go up till 180 months. That's why, take the first step towards financing your business goals today!