A Step-by-step Guide To Land Purchase Loans

By Author: Aishwarya Mahurkar
Total Articles: 33
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Land purchase loans are more unusual than home loans. The rules and regulations for land purchase and the applicable loan are far more complicated. So, if you plan to buy a plot with help of a loan, get ready for the prerequisite land loan processing. It suffices to say that it will take you longer than the standard duration for home loan processing.

Documentation:

A major step in plot loan processing is to get all the documentation right. Documentation for land loan will vary from one piece of land to another. You must ensure that you have valid documents that cannot be contested by other owners, heirs, rivals, etc. You must ensure that you have all the necessary NOC certificates from respective departments. Getting all the necessary documents from the seller can be a major cause for postponement. However, it is vital for protecting your own asset as well. So, do not overlook this facet as unnecessary.

Credibility:

You will need to make necessary repayments over a course of time. This is the most crucial factor for your lenders because a land loan is not a common loan in the market. So, lenders ...
... tend to be over-cautious. Therefore, you will need sufficient documents to exhibit your repayment ability. It is not just about your credit score when you apply for a plot loan . So, look upto your personal finance consultant before you make any significant decision, evaluate your credit history and rectify the likely loopholes to ensure that your plot purchase loan application does not get denied due to any reason.

Rules and regulations:

If you qualify for a land purchase loan in India , then you will still need to consider quite a few rules and regulations to avoid penalties and taxation hassles. For example: Any repayment towards the principal amount and interest of the plot loan or plot construction loan will be exempted from your taxable income. The overall limit for income tax rebate varies with the budget each year. Even while repaying your loan for land purchase, this asset can be your great alley through tax rebate and loan against property.

So, contact your personal finance consultant before you finalize the details of your plot loan such as interest rates, repayment option, etc. However, primarily, you will need to understand the applicable rules and regulations in India to protect your asset from likely threats. Use caution and do not make a rushed decision. Long term planning will be vital to any form of land purchase, whether it is an investment or a land for your dream retirement home.

Author Bio :

Aishwarya Mahurkar is an experienced writer concerning the housing finance industry. Her articles help in informing her readers of the apply for a plot loan processes that cover land purchase loan in India, interest rates required documents etc.