Property Loans are Much Better than Personal Loans

Borrowing a loan is not that big an issue nowadays. A loan can be borrowed for any reason and there are available a number of loan options in the financial market. A few of the most popular loan options which popular financial institutions offer in the market are personal loans, Property Loans, Loan Against Property, NRI loans etc. The best option which is available in the market for borrowing funds is Loan against a real estate asset. This is so because these loans are backed up with real estate assets, meaning these are secured loans and hence are easily borrowed in comparison to the personal loans. Also, these have lower interest rates because of the same reason.

So what all are the difference between a personal loan and a Real Estate Loan? Well the major differences are Loan Against Property Eligibility and eligibility criteria for personal loans. The eligibility criteria for both are different because of the nature of these loans.

What exactly is the difference between a Personal Loan & Real Estate Loan?

• A loan against property or house is given against a property or house of the customer while a Personal loan is a loan given for the purchase of your house or house.
• In a loan against property or house, the end use is not supervised and you can utilize these funds to meet any of your financial requirements. Whereas in a Personal loan, the end use of the loan is supervised to ensure that the loan is actually used to pay the seller of the exact property or house.
• The prices on loan against property or house are higher than prices on loan financial loans because the purpose, for which the loan has been utilized, is not supervised by the bank.
• In a Personal loan, the agreement value of the exact property or house is taken as a benchmark. In a loan against property or house, the finance is against a property or house, and hence the exact property or house needs to be valued by an approved valuer. Therefore, the loan is based on current market value.
• The maximum tenure for which you can get a loan is longer compared to that of loan against property or house. For loan financial loans its 25 years whereas its only 15 years in case of loan against property or house.