Taking a loan, when cash needs surround you from every corner, become inevitable. People, succumbing to the pressure of cash need, end up taking loans from private lenders who charge very high flat interest on the borrowed amount. In fact, the lack of a feasible repayment system makes it almost impossible to repay the debt. In such situations, continuing with the same debt drags you deeper into the trap. Here you’ll be left with only two options;
(1) Consolidate your mortgage loan using a subtle financing scheme, with a systematic repayment plan in place or
(2) Sell your properties to get out of the debt.
If you choose the second approach; you know or should know what to do. However, if you choose to follow the first approach; you must keep three things in mind:-
- The loan you decide to use for debt consolidation is availed from a registered NBFC or a bank. This would ensure the existence of a systematic repayment plan. Systematic repayment plan would ensure a fixed percent of payable interest and principal amount is paid with every EMI.
- The interest rate should be low. For that, you can use a loan against property as debt consolidation. Loan against property, due to the availability of a collateral, is offered at a lower interest rate.
- Make sure the repayment time is long enough to ensure comfortable payment of EMIs. If possible, ask lenders to allow you to choose your repayment on your own. Then you can choose the repayment tenor as per your repayment capacity.
Additional Read:
How can a Loan Against Property help you to get Debt-Free?
Loan Against Collateral 