If you do not fulfill the eligibility criteria to get a Home Loan to buy a piece of land, then it may appear viable to Apply for a Personal Loan for the same. These loans are faster in comparison to any other loan in terms of processing time. But before you opt for a Personal Loan to buy land, it is a good idea to weight out all the Pros and Cons. That way, you will be able to get a loan that fits into your budget and helps you finance your land easily.
You can get a loan for any personal use with schemes like Fullerton Bank Personal Loan. These loans are available without any collateral or security and are the ideal choice for anyone who requires immediate financial assistance.
You can get a Personal Loan for a host of different uses that include your travelling costs, any unexpected medical emergency, home renovation costs, to repay other outstanding loan(s) or just about any additional expense. You need to be aware of the eligibility criteria of various banks and the different schemes so that you get all your documents right and reduce the processing time. Depending upon the financial institution that you choose and the type of Personal Loan that you opt for, you can get a loan sanctioned in as little as 72 hours in case of an emergency.
You can also use the Personal Loan to purchase land if you do not have the necessary savings or if you are unable to Get a Home Loan sanctioned by the bank. You will be able to get the financing that you need to cover the down payment as well as the actual cost of the land if you fulfill the necessary eligibility condition.
With any Personal Loan scheme, be it Allahabad Bank Personal Loan or even a loan from a private financing institution you need to fulfill certain conditions in order to get your loan sanctioned. The personal loan eligibility criteria are slightly different for each bank. You have loans available for both salaried individuals and self-employed individuals. Some general eligibility criteria for these loans are as follows:
The individual should be at least 21 years of age.
The maximum age of the individual depends upon whether he or she is salaried or self-employed. Usually, the maximum age for salaried individuals is 60 years, and for those who are self-employed, it is 65 years.
You need to have the necessary minimum income in order to be eligible for the loan. The EMI should not be more than 60-65% of the monthly income in most cases. Using an EMI calculator is the best way to determine if you are eligible for a particular loan or not.
For salaried individuals, it is mandatory that they have been at a particular company for at least 1 year. Self-employed individuals need a minimum experience of 2 years in the field of work that they are running their business in.
Getting a Personal Loan is certainly an option that you could consider if you do not have any other option to finance your land purchase. There are some advantages of choosing a personal loan for this purpose:
Unlike Home Loans that require a high CIBIL score, with a Personal Loan, you can get approval even with a credit score that is as little as 580.
The most significant advantage with a Personal Loan is that you do not have to provide any security or collateral in order to avail a loan if you fulfill all the Personal Loan eligibility
Personal Loans are structured to help individuals in case of financial emergency. As a result, the processing time for these loans is also much lower. You can get a loan within 72 hours in some cases.
With most other options like a Home Loan, you will only be able to get funding for a part of the property value. You have to pay the rest from your own pocket. However, with Personal Loans, you have the advantage of getting the amount that you need to cover the down payment as well as the remaining value of the property.
Like any other loan plan, even the Personal Loan has certain downsides that you should consider before you apply for one. The main disadvantages of choosing a Personal Loan are as follows:
Since a Personal Loan is unsecured, the interest rate is a lot higher in comparison to a Home Loan. With Personal Loans, you can pay anything between 10.75% and 35% as the interest rate. However, with Home Loans, your interest rate is much lower, usually anywhere between 8.5% to 15 % p.a. This means that the EMI that you pay towards your Home Loan is more likely to fit into your budget.
Another factor that affects the EMI that you pay towards the loan is the tenure. With a Home Loan, you can get up to 30 years for repayment. This tenure is shorter for Personal Loans and usually between 1to 5 years depending upon the bank that you choose.
The Personal Loan that you get depends upon monthly income while Home Loans depend upon the property value. The loan amount that you will be able to get with a Home Loan is much higher. It is very rare that you will be able to cover the entire cost of the land with just a Personal Loan.
To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.mymoneymantra.com, the leading online lending marketplace that offers financial products from 60+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.