A loan against property is a great way to finance big-ticket requirements and purchases. Also known as secured loans, these are are backed by a property that you own that acts as a mortgage. As these loans are backed by a pre-owned property, they carry lower interest rates and usually have higher tenures. LAPs are also a great way to extract value out of your property while maintaining their occupancy.

However, there are a few things that you should definitely consider before opting for a loan against property. Here are 5 of them:

Interest rate on the loan

Interest rates determine how much more you will end up paying on the initial amount borrowed and this is a major factor that you need to consider before applying for an LAP. Interest rates can depend on a lot of factors such as your income, credit score, outstanding debts and present economic conditions. Make sure to get the best deal out of your LAP by negotiating a lower interest rate.

Fixed vs Floating Interest Rate

Also, when it comes to LAPs, you usually have an option to choose between fixed rate loans and floating rate loans. Under fixed rate loans, the interest rate and your EMI remain fixed for the entire tenure of the loan. Under floating rate loans, these interest rates fluctuate based on a benchmark rate. Make sure you research before making the final decision.

No tax benefits

Unlike housing or education loans, where interest payments are tax deductible, LAPs have no tax benefits. So, you will not be able to avail any tax benefits on the interest that you pay towards your loan repayment on an LAP.

Know the value of your property

The amount of loan that you can raise will depend greatly on the value of the property that you keep as mortgage. The finance offered by lenders on your property differs. So, it becomes important to conduct some research regarding how much your property is actually valued.

Prepayment and foreclosure fees

These are charges that you will be liable to pay in case you pay back your loan before its tenure ends. Make sure to inquire about how much your lender charges as foreclosure fees.

Conclusion

So, make sure to keep these factors in mind when opting for a loan against property to get the best deal for yourself.

If you are looking to apply for a loan against property, IndusInd Bank offers some great benefits and features on LAPs, which include a hassle-free online application process, higher loan amounts, the best market interest rates, and more. To apply for a loan against property with IndusInd Bank, click here.

Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.

Planning to move to the UAE? You are in for a surprise. Apart from the amazing skyscrapers, sandy beaches, and tourist destinations to explore, UAE has some of the most liberal tax policies around the globe. This attracts many corporates and individuals to work out of the UAE. Here is some important tax information that you need to know before moving to the UAE:

Income tax

There is none, at least for now. People working in UAE do not need to pay any income taxes.

The UAE does not levy any tax on income. Whether it’s a business or an individual working independently, everything that a person earns is not taxable. However, this is about to change as the UAE recently announced a federal corporate tax on businesses for the first time ever. From June 1, 2023, businesses with an income of more than AED 375,000 will be subject to a corporate income tax at a fixed rate of 9% on income exceeding AED 375,000. The income tax will stay at 0% for incomes below that level.

Capital gains tax

Capital gains tax is again zero in the UAE. As the region is funded mostly by oil and gas money, it barely levies any taxes. In fact, there is no concept of taxes such inheritance tax, capital gains tax, estate tax, etc. in the UAE

VAT

The only tax needed in UAE is the 5% VAT that is levied on the sale and purchase of all goods and items. Compared to other countries, this tax rate is again very low, which is something to cheer about. There are some exemptions to VAT as well such as state education.

Tourists can claim VAT refunds

In order to attract tourism, UAE allows tourists to claim VAT refunds for goods purchased in the UAE when they are headed back at the airport. There are a few conditions that should be met, however, to claim this tax refund:

• The goods must be purchased from a company participating in the VAT refund scheme
• Tourists need to leave the UAE within 90 days of purchase along with the goods

Expensive if you are a smoker

Another thing to know about taxes in the UAE is that unhealthy goods such as fizzy or carbonated drinks and cigarettes are taxed at much higher rates under the name of excise tax. Cigarettes in the UAE attract a tax of a whopping 100%, while it is 50% for fizzy drinks.

Final words

Lastly, people planning to move to UAE need to be aware of factors such as repatriation of money, managing your assets back home, etc.  IndusInd PIONEER Banking can help you out with all that. The IndusInd Bank NRI account is specially catered to the needs for NRIs. It is an end-to-end solution for NRIs and includes features such as remittance services, document pick-ups from overseas locations, and portfolio management services. Opening an NRE account will enable NRIs to avail FD and SA rates without any Taxation or TDS – which is a huge advantage. And with IBL giving among the highest FD and SA rates among the Indian banks this leads to a benefit of the client. If you would like to know more, click here.

Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.

Buying your first home can mean different things to different people. On the one hand, it can be an emotional investment for some, and on the other, it may represent climbing the ladder of success for others. But one thing that remains constant is that it is a significant financial commitment. To make your job easier, you can apply for a home loan online by IndusInd Bank and unlock the door to your happiness.

However, if you are worried about high-interest rates on home loans, this article is for you. Keep reading to learn how to bring down your home loan rates and pay the loan easily.

Why Should You Borrow a Home Loan by IndusInd Bank?

At IndusInd Bank, we work hard to fulfil your dream of owning your dream home. Therefore, we bring you a wide range of housing loan products with a myriad of benefits, such as:

• Attractive home loan interest rates
• Simplified documentation
• Balance transfer facility
• Transparent processing
• No hidden charges
• Doorstep services

Factors that Impact Home Loan Rates

Here are the top factors that lenders consider while deciding your home loan interest rates.

#1 Credit Score

As you know, your credit score reflects your creditworthiness to the lender and helps them judge whether you are a responsible borrower. Therefore, a good credit score can be a sure shot way to fetch you lower home loan rates. Why? Because it gives you a chance to negotiate with the bank or lender based on your creditworthiness.

So, before you apply for a home loan online, ensure a healthy credit score by making timely repayments and keeping a close eye on your outstanding debts. You can also find other simple yet effective methods to improve your credit score.

#2 Location and Value of the Property

Another factor that plays a vital role in determining your interest rates is the location and value of your house. If the property is located in a low-profile neighbourhood or has meagre amenities and poor construction, the resale value would be reduced. As a result, the lender may charge high home loan rates.

#3 Job Security of Applicant

Having a stable job and income can do wonders for your loan application. This is because having an unstable income makes you a high-risk loan candidate for the lender. So, if you are a doctor, chartered accountant, salaried professional, a government employee, etc., you can get lower home loan interest rates on the housing loan.

#4 Type of Interest

As a home loan borrower, you must have come across terms like fixed, floating and mixed interest rates. As the names suggest, fixed rates stay constant throughout the loan tenure, and floating rates fluctuate according to the market changes. Mixed interest rates stay fixed for a certain period and then change to a floating rate. Since fixed and mixed interest rates are considered riskier, banks may charge a higher interest rate on them.

#5 Loan Tenure and Amount

Last but not least, a shorter loan tenure can fetch you a lower rate of interest and a longer loan tenure may attract a higher interest rate.

Plus, your loan amount can also impact the interest rates as some banks charge a higher interest rate on a high amount as it implies a more considerable risk to the lender. Thus, paying a large down payment is a wise way to decrease the home loan rates.

Parting Thoughts

If you are searching for a home loan to purchase your dream abode, home improvement or home extension, partner with IndusInd Bank. We offer you a whole range of offerings and a hassle-free borrowing process. So, why overthink it? Visit our website and apply for a home loan online today!

Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.