What am I?
I am just like any other loan, but to get me you have to mortgage a property you own. It could be a self-occupied residential or commercial property. And, of course, the property should not have been used as a security for any other purpose.
In what form will you get me?
You can take me as a lump sum amount, wherein you will have to repay me in equated monthly instalments. You also have the option of taking me as an overdraft account, which lets you draw more than your available bank balance.
What are my benefits?
I am available in both fixed and floating interest rate options. You can get me at a much cheaper rate than a credit card—you pay an interest rate of 12.50-15.75% to get me compared with 35% for a credit card. However, I am almost on a par with personal loans in terms of interest rate. I let you borrow a larger amount than a personal loan. You can borrow as much as Rs3 crore through me. Also, after housing loans, I offer the longest repayment duration.
Red flags about me Getting me is easy but make sure that you repay me on time. If you don’t, you run the risk of losing the property you pledge.