What are Mortgage Loans?
Mortgage Loans in India are available from every bank and can be availed by salaried or self-employed people to help themselves in times of particular personal needs by mortgaging their property. It’s a secured loan. Usually, these loans are sought for business expansion, education, marriage, medical emergencies, or a vacation, and are sanctioned against residential, industrial, or commercial properties. However, the purpose of the loan must be clearly stated to the bankers. However, it may not be prudent to consider a mortgage loan amount for a home purchase, home construction, renovation, or a plot purchase.
How Mortgage Loan Interest Rates in India is Calculated?
- Mortgage loans are usually given at a higher interest than home loans within a range of 8%-15% Interest Annually. Only if a salaried employee draws a minimum of Rs. 40,000/- pm or a self-employed person draws Rs. 3 lakhs is eligible for a mortgage loan. The term of repayment is usually for a maximum of 15 years. An LTV of 60-70% is considered for a Loan against Property. Banks give Mortgage loans either on the property’s market value or the registered value of the property, whichever is higher.
- To get a mortgage loan, you have to check your Loan Eligibility and the EMI you can afford with EMI Calculator. Then the property’s legal documents must be verified. You then must decide on the interest offers from various banks and compare other charges and loan parameters of the banks you have shortlisted. Finally, select the financier based on the best service options.
- The eligibility of a mortgage loan applicant and the process of sanction are not very different from the other loans. The applicant’s profile, creditworthiness, income flow, employment or business standing, LTV & FOIR are all legal considerations for the approval process. It usually takes around a fortnight for the sanction.
Are Mortgage Loans Secured or Unsecured?
A mortgage loan is a type of secured home loan which uses a real asset as collateral such as a house and plot.