More and more people in India are opting for loans to deal with immediate financial crises or plan loan term financial needs. These loans are in different forms like secured loans, unsecured loans, and debts from credit cards.
Getting a loan and paying the loan amount on time with interest reflects positively on the CIBIL credit score.
However, the problem arises when you have taken multiple loans due to which you have to pay multiple interest rates. Having multiple debts could put you in a bad financial situation.
However, the best way to reduce paying several debts every month is by opting for debt consolidation. It is a way to bring your multiple debts under one loan by choosing home mortgage loans.
LAP
A home mortgage loan or loan against property is a secured loan that requires the borrower to pledge his property as collateral to be eligible for the loan. The loan amount is usually high because it is determined based on the locked-up value of the property.
A home mortgage loan is used for multiple purposes, and it comes with longer repayment tenure, offering flexibility to the borrowers. The best part is that the mortgage loan interest rate is significantly low.
Here are the ways to consolidate your multiple debts with a home mortgage loan
High loan amount
The loan amount is calculated based on the current value of the property that is pledged as collateral, and the property value is usually high given the market demand. That means the approved home mortgage loan amount is substantially high, and you can use it to consolidate your multiple debts.
Low-interest rate
A home mortgage loan is a secured loan because the property is kept as a mortgage to the bank. The property being the collateral, the interest rate is lower than other unsecured loans. By choosing a LAP loan you will have to pay only one substantially low-interest rate. It allows you to decrease the amount that you have to pay every month because of multiple debts.
Properties that are given as collateral
Another reason you can opt for a home mortgage loan is the flexibility to keep any property as collateral. You can offer both residential and commercial property as collateral to the lender. For instance, it can be your house, office, or shop.
Quick loan disbursal
Based on your financial profile, you can usually get a lap loan with the best mortgage loan interest rate within 3 days of application. Since it serves multiple purposes, you can immediately pay off your multiple debts and set yourself free from the burden of paying several debts every month.
Easy financial planning
Multiple debts require you to properly manage your pay-check and monthly expenses to pay EMIs on time, and if you don’t have enough funds in your account, you will have to pay late payment charges. With a home mortgage home, there is only EMI that you have to pay every month, which is easier to plan and execute.
So, a loan against property that comes with a high loan amount, low mortgage loan interest rate, and flexible loan tenure is the best way to consolidate your multiple debts and lighten your financial burdens.