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Loan Against Property (LAP) is surrounded by a lot of popular misconceptions that need to be dispelled. To learn more about LAP and the myths surrounding it, read the blog.

Simply put, a loan against property (LAP) or mortgage loan is a secured loan you can obtain using your home or business property as collateral. LAP is said to be the finest option to meet all of your financial demands because to the low interest rate and flexible end-use when compared to other sorts of loans like a personal loan, a gold loan, or a company loan.
It is quite easy to apply for LAP. All you have to do is use your real estate, whether residential or commercial, as collateral with a bank or NBFC in return for a sizable sum of money, and repay the loan with fixed-term EMIs. A loan against property, as opposed to an education loan or a home loan, can be used to meet a variety of financial demands, including wedding costs, higher education, home or business expansion, etc.

Ten Commonly Assumed Myths about Loans Against Property (LAP)
Despite being a gift for many, loans against property are often misunderstood. To learn about the LAP misconceptions we have disproved, read on.

1. You Are Not Allowed to Use the Property You Have Pledged
The idea that you cannot live in or use the property you have pledged as collateral to obtain a loan is one of the most pervasive misunderstandings about LAP. This myth is untrue. There is no problem with this as long as you make your EMI payments on time and do not go into default on your repayment. So, to find out what your predicted EMIs would be if you took out a certain loan amount, utilise a Loan Against Property EMI Calculator online before you apply for LAP. By doing so, you can determine if you can afford the EMIs even before you apply for a house loan.

Additionally, if you don't pay your EMIs on time, the lender has the authority to sell your home to recoup the unpaid loan balance. Therefore, be careful to pay the EMIs on time as missed payments also have a bad effect on your credit score. Automating EMIs is advised by giving the bank standing instructions.

2. The End Use of the Funds is Limited
Another prevalent misconception about LAP is that there are limitations on how the money may be used in the end. A Loan Against Property can be used to meet a variety of financial demands, with the exception of speculative or unlawful ones, just like other loans including gold loans, personal loans, and top-up house loans (such as for medical expenditures, wedding costs, higher education, home or company development, etc.).

3. Only Residential Real Estate May Be Pledged
Many of us believe that the only type of collateral we may use to apply for LAP is a residential property. This is untrue, though, as you may also use a commercial property—even a factory or a warehouse—as collateral when applying for a loan against property. If you want to receive the loan money promptly and without any problem, all you need to do is maintain all of your paperwork  and present genuine proof.

Common loan against property myths busted

Shubham housing development finance company ltd. provides you with the Home Loan perfectly suited to fit your needs. We also offer Home Loans to salaried and self-employed individuals wishing for a space of their own in their home town or village.

Common loan against property myths busted

Shubham Housing