A loan against property is a secured loan where you pledge your property as collateral to borrow money. It is often used for large expenses like funding a business, education, or medical emergencies. However, before taking this type of loan, it is crucial to consider several factors to ensure it is the right decision for you.

1. Understand the Value of Your Property

The loan amount you can get depends on the value of the property you are pledging. Typically, lenders offer 50% to 70% of the property’s current market value as a loan. It is essential to get your property evaluated by a trusted professional to understand its worth. This will help you determine if the amount you need can be raised through this loan.

2. Check Your Repayment Capacity

A loan against property comes with a long repayment tenure, usually ranging from 5 to 15 years. While this makes the monthly installments smaller, you must carefully assess your repayment capacity. Consider your income, existing debts, and monthly expenses to ensure you can manage the EMIs (Equated Monthly Installments) comfortably.