Types of Mortgage Loan in India
Mortgage is the collateral thing that is given against the loan amount by the financier or the bank. Mortgage loan is a kind of loan in which the borrower collaterals anything as a mortgage and gets a loan in return.
Mortgage could be any immovable thing such as vehicle,house,property,jewellery etc. When the loan amount is repaid by the borrower then they can get their mortgage back.
BENEFITS OF MORTGAGE LOANS
- The mortgage loans are good because you can get your property back after the repayment of the loan amount.
- The mortgage loans provide better and good interest rates for you.
- You do not have any need of paying penalties of the prepayment.
- The other benefit is that you do not have to pay the insurance of the mortgage you have given to the lender.
- You do not have to give the down payment for the mortgage loan.
TYPES OF MORTGAGE LOANS
Mortgage loan is of six types. Here we have mentioned the various types of mortgage loans for your knowledge.
LOAN AGAINST PROPERTY (LAP):
The loan against property or LAP is a type of loan in which the borrower colletrates their property for the loan. The original papers of the property are kept by the lenders and stays with the lender till the complete amount of the loan is given by the borrower to the lender. The repayment tenure of the LAP is about five to seven years.
COMMERCIAL PURCHASE LOAN:
The commercial purchase loans are usually taken by the businessmen and entrepreneurs. The commercial purchase loan is taken to buy any property such as shop ,complex, office, building, etc. The condition of this loan is that the loan amount should only be used for purchasing the property.
SECOND MORTGAGE LOAN:
The second mortgage is taken in emergency. This loan allows an individual to take two loans against one property. If the borrower has taken a loan from someone in against of a property and wants to get another loan then the lender can give it to him by checking credit history and score.
REVERSE MORTGAGE LOAN:
The reverse mortgage loan is only for senior citizens. This loan scheme is recently introduced in india.The senior citizens have not fixed monthly income and they need money for their food,medicines,etc. The reverse mortgage loan allows the lenders to give loan against any of the property of the borrower or senior citizen and provide monthly money to them. After the death of the older adult, the lender has rights to sell out the property legally.
The home loan is taken by the borrowers for building,renovating,expanding,and re-decorating their house. Home loans are very common in india. People want their own house and go for the home loan option to fulfill their dreams. The home loan restricts the borrower from using the loan amount for their personal use. The borrower could only use the loan for their housing work.
LEASE RENTAL DISCOUNTING:
Most people build their house and then give it on lease. They can get a loan against the leasing house also. The loan of this type is called leasing rental loan or leasing rental discounting. The rent of every month by the house is used as EMI payments. The repayment tenure depends upon the time given by the borrower to repay the loan amount.
APPLY FOR MORTGAGE LOANS
Apply for a mortgage loan in a few easy steps.
- Firstly check your credit score and credit history.
- Search the best lender or bank for getting the mortgage loan.
- Fill the application form.
- Paste your photograph and attach all the documents required including the mortgage papers.
- Submit the application form.
- Signature the documents and application and confirm the loan.
- The loan amount will be given to you after verification of the documents.
DOCUMENTS REQUIRED FOR THE MORTGAGE LOANS
- The identity proof of the borrower is required for the loan approval.
- Aadhar card,PAN Card,voter card,licence,passport,etc any identity proof is required.
- Bank statement of at least past three years.
- Age proof such as aadhar card,licence,etc.
- Salary slip of last month is required.
- Property papers or mortgage paper’s copy.
ELIGIBILITY CRITERIA FOR THE MORTGAGE LOANS
- Age criteria for a salaried employee is 33 to 58 years.
- For a self employed individual the age criteria is 27 to 70 years.
- Nationality or residency should be of India.
- Monthly income for salaried employees and self employed individuals is 25,000 per month.
DISADVANTAGES OF THE MORTGAGE LOANS
- The amount you have borrowed by the lender is small in front of the amount you will have to pay in the return of the loan amount.
- You will feel a very big difference in your monthly payments as the half of the payment is spent on repaying the loan.
- The rate of the mortgage increases by time but in some cases it doesn’t work.
BANKS PROVIDING MORTGAGE LOANS AFTER COVID-19
|Union Bank of India||Bank of India|
|Central Bank of India||SBI Max Gain|
|Canara Bank||IDFC First Bank|
|Punjab & Sind Bank||Punjab National Bank|
|ICICI Bank||Bank of Baroda|
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