A loan against property usually has a long repayment tenor, going up to 180 months. When selecting a tenor for your loan against property, there are several factors to keep in mind. Knowing these factors will also help you avoid defaulting on payments and paying penalties that accompany it.

Here’s a closer look at some important factors that influence the length of your tenor:

1. Your Monthly Income

  • Your monthly income lets you plan how much you can pay towards EMIs. Keeping this in mind, you can select a tenor that doesn’t strain your monthly finances significantly.
  • The longer the tenor, the lower each EMI will be. As a result, you will have to part with smaller amounts of your income. But, a longer tenor also means that you will bear the financial obligation of repayment for longer.
  • A shorter tenor, on the other hand, will have high EMIs. But you will be able to clear the loan quickly and boost your credit score too.

2. Your Age

  • Age is a factor that greatly determines the tenor of your loan against property. This is because young loan applicants have more scope for growth in the future and hence can opt for a longer tenor.
  • On the contrary, older people don’t have as many working years ahead of them and may be close to retirement. Younger applicants are also likely to have a higher disposable income, which allows them to take loans with a short tenor.
  • So, don’t forget to consider your age and retirement plan before selecting the tenor of the loan.

3. Maturity Dates Of Other Investments To Pay EMIs

  • Investments are a great way to multiply your wealth. It is best if you have a mix of investments in your financial portfolio even if you are borrowing a loan.
  • The reason for this is that the amount earned from your investments can be used to pay the loan’s EMIs and to make prepayments.
  • Hence, if you borrow a loan whose tenor lapses alongside the maturity of an investment, you can use the profit from it to pay the interest on your loan. This will also help you choose your loan tenor better.

4. The Tenors Of Other Borrowings Or Debt

  • When borrowing a loan against property, you should consider the tenors of existing debts and apply accordingly.
  • Applying for a loan after you have paid off other debts is ideal. This reduces your financial burden greatly.
  • Also, borrowing many loans with the same tenor negatively impacts your credit score and also makes repayment more difficult for you.

5. The Duration Of The Project That You Are Using The Loan For

  • If you are using the loan for a specific project, you should also consider its duration.
  • If your project’s deadline matches with the lapse of the loan tenor, then you can use profits from the former to repay your loan. This arrangement can make repayment more convenient.

When it comes to choosing your loan’s tenor, it is best to evaluate your options based on these five factors. After all, you want your loan to be affordable, convenient and hassle-free. Borrowing a Loan Against Property for Doctors from Bajaj Finserv checks all these boxes. Apart from this, you can enjoy quick disbursal and value-added services that enhance the benefits of your loan.

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