Personal Loan

Top 10 Benefits Of Loan Against Property For Overseas Education


Education is a crucial part of life. It prepares people to take on the various challenges that life can throw at them. However, education costs have skyrocketed in recent years. When it comes to studying abroad, the cost goes up further. In most cases, you might not have enough money to pay for the entire cost. But you cannot let money stand in the way of you or your child pursuing higher education overseas. This is where the option of a loan against property for education abroad comes to your rescue.

As real estate prices have also gone up in the last few years, you can put your property to use and get the money you need for overseas education. Many banks and NBFCs offer this loan based on the value of the property against loan. Read on to learn more about this loan against property and its benefits for education abroad.

What is a loan against property?

A loan against property, also known as a LAP, is a secured loan offered by many banks and NBFCs. Herein, you must offer the property in the form of security. The amount that you can get as LAP will depend on the value of the property against loan. As these are secured loans, the loan against property interest rates are much lower when compared with other loans.

The maximum amount you can get as LAP varies between lenders and ranges from 60% to 70%. The tenure in the case of a loan against property can go as high as 18 to 20 years. Hence, you will have to pay low EMIs as the loan against property interest rates are low and the loan tenure you can get is very high. Once the money is in your account, you can use it as per your choice and one of the well-known uses of LAP is to finance abroad education.

Why loan against property for an education loan?

Instead of using a LAP, why not get an education loan to pay for your overseas education? Well, the benefits that you can get from using a loan against property to pay for education at a foreign university are as follows:

  • High Loan Amount: There is, in fact, no upper tab that can limit the amount you can get under LAP. Most lenders offer up to 70% of the property’s value as a loan against it. So, you can get crores of rupees with this option to pursue education at the best colleges abroad. This money is adequate to pay not only for college fees but also for living and other expenses.
  • Low Interest Rates: – Loan against property interest rates are very low compared to an education loan, which is a form of a personal loan. As LAP is a secure loan, there is less risk for the lenders, so they offer low interest rates on it. Low interest rates will help keep your EMIs low, making it easy to repay the loan. 
  • Continue to Use Property: When you go for a loan against property to pay for foreign college fees and other expenses, you do not have to give up the property. If you live in that property, you can continue to do so as there is no effect on your ownership. This is a great option to meet all your urgent needs and still be the asset owner. 
  • Long Loan Tenure: The maximum tenure to repay a LAP is much longer than an education loan. You have between 18 and 20 years to pay off the loan. This feature helps keep the EMIs low and makes it easy for you to pay the EMIs on time. You can select a tenure that gives you an EMI, which will help you pay off the loan on time.
  • Less Processing Fee: As it is a secured loan, there are some charges that the lenders will levy to verify the property and check the legal title. But other than that, the processing fee and other expenses are less than education loans. Hence, you can save a lot of money for other purposes. 
  • Quick Process: Most lenders complete the loan process for a LAP in a short time. This has been made possible with the help of the latest technology, where most of the steps are completed online. You need to submit some basic documents to start the process, and then offer the papers when asked for. Lenders typically take up to two weeks to complete this process. 
  • Top-Up Facility: Another benefit of a LAP is that you might not need another loan once you take it. This high-value loan can take care of most of your needs. You can get a top-up loan from the lender if you need more money. You must have paid all your EMIs on time to get this facility. The maximum amount of a top-up loan cannot exceed the original loan value. 
  • Property Use: If the property is lying idle, then taking out a loan against the property is a good option to put it to use. You can get a high-value loan to pay for abroad education costs and will still be the owner of the asset till you pay your EMIs on time. Lenders only mark a lien and create a charge on the property, but it is only symbolic; the physical possession will be with you. 
  • Waiver of Foreclosure: Many lenders allow foreclosure of a loan against property. Herein, you can repay the entire loan and need not pay any charges. This feature is available after a certain number of EMIs have been paid. So, when you have spare funds, you can pay off the amount. 
  • Balance Transfer: As the loan tenure is quite long, you can look for better offers from other lenders. You can opt for a LAP balance transfer if you get a better offer. In such cases, new lenders offer better terms and interest rates, making the loan more affordable.

A LAP is a good choice if you want to pursue higher studies at a foreign college. It will help you pay all your expenses, including living costs. For the best deals and offers on loan against property, get in touch with Piramal Finance. They provide high-value loans at low interest rates. You can also read their blogs and articles to get a better handle on your finances.