There are many ways to secure a loan for plot purchase. Most financial institutions offer financing for up to 70% of the cost of the plot. These loans have a tenor of between fifteen and twenty years. A land loan will also come with higher interest rates than a home loan. A plot loan will generally come with a margin money of between thirty to fifty percent. Borrowers do not get tax benefits for the EMI repayments, but they will once construction begins.
Before applying for a loan for plot purchase, it is important to determine the value of the property. In order to ensure that your property purchase is a sound investment, make sure the plot has been surveyed and has public roads and utilities. It is also a good idea to purchase a build-ready plot to cut down on borrowing costs. If you’re concerned about land-use restrictions, you can check with the local planning department. A new park will likely raise property values, but a highway or sewage treatment plant will likely decrease property values.
If you don’t have enough cash on hand to buy a plot, you may consider a home loan or a plot loan. Both loans are available with a reasonable interest rate and a manageable repayment period. You’ll want to make sure that your income is sufficient to cover the EMI. In addition, plot loans can come with tax benefits. You’ll want to consider all of the different types of loans when you’re considering a loan for plot purchase.
To qualify for a plot loan, you’ll need to have a good credit score. Your cibil score is an important part of determining the interest rate you’ll have to pay for your plot purchase. A bad cibil score can cause your lender to raise your interest rate. You’ll also need to maintain a low debt-to-income ratio, as having less debt is better for getting approval for a plot loan.
You’ll also need some important documents to secure a plot loan. Most banks offer loans up to 70% of the purchase price of a plot, but you’ll have to pay a down payment before getting your loan. You can get a site loan if you’re not planning on constructing a house on your plot. You’ll need to provide some documentation that proves you own the property, but the interest rate is lower than a home loan.
While getting a plot loan will allow you to build a house, the money you need to buy the land is also important. In addition to the land itself, a home loan will help you pay off your mortgage. If you’re not able to pay off the loan, lenders will confiscate your property if you fail to repay the loan. Therefore, it’s important to shop around for the lowest interest rate you can find.