SYNOPSIS

Are you looking for -

a loan against your existing property for funding of business or personal expenses?
an additional/top-up loan on your existing home loan?
a loan for purchasing commercial premises?
a loan by discounting your lease rental income?

Your home loan provider can offer you these loans too
You needn’t look elsewhere

Most of us think of a housing finance company when we want a home loan – and it’s only logical to do so, given the specialization that these companies have in the home loan segment. However, housing finance companies have grown over time and have diversified their portfolio of loan offerings to also cater to the needs of the non housing segment. You can approach a housing finance company for several other types of loans – be it for purchase of non-residential (commercial) property or for funding of business or personal expenses. Let’s take a look at the loan options in the non housing segment offered by housing finance companies:

Loan against Property

You can meet your business or personal expenses by taking a loan against property i.e. by mortgaging your existing commercial or residential property. Being a secured loan, the processing and approval is simple and quick. Moreover, the interest rate is lower in comparison to a commercial or consumer loan. Generally, you can get a loan of up to 50 percent of the market value of the property (as assessed by the lender). The tenure of the loan can extend to 15 years.

Top-up Loans

A top-up loan is meant for those who have already taken a home loan. Typically, home loan repayments stretch over a long period. During this period, you may need additional funds for various purposes such as a marriage in the family, medical treatment of ailing parents or children’s education. In such cases, instead of exploring other sources of finance, you can easily avail a top-up loan over your existing home loan. Usually, housing finance companies allow customers to avail a top-up loan after 12 months of the final disbursement of the existing home loan and upon possession or completion of the financed property. In most cases, the total amount of the outstanding loan and the top-up loan cannot exceed 75 to 80 percent of the market value of the property.

Loans for Commercial Premises

Housing finance companies also offer loans for purchase, extension, construction or improvement of commercial premises, including built-up properties and plots. These loans can be availed by businessmen or professionals, including doctors, lawyers and chartered accountants etc. The amount of the loan can be as high as 75-90 percent of the cost of the property, while the tenure may extend to 15 years subject to the repayment capacity of the customer, as assessed by the lender. Housing finance companies often provide customers with expert legal and technical counselling to facilitate the purchase of commercial premises.

Lease Rental Discounting

Usually commercial properties fetch plum rentals. Owners of commercial properties can also avail lease rental discounting facility to get a loan against the rental income receivable. Under this facility, owners can usually get a loan of up to 50 percent of the market value of the property (subject to the net rentals, lease tenure and other such factors).

upshot

While retaining their specialization in the home loan segment, housing finance companies have diversified their services by offering several other loans, including loan against property and loans for commercial premises Most of these loans are backed by mortgage against property. Therefore, the rate of interest is lower in comparison to the rate charged on other commercial or consumer loans. Moreover, the loan approval process is simple and hassle-free. Therefore, those who want to borrow should consider these advantages to make a prudent choice.