100floors.com: Disadvantage of Loan against Property

Online, September 18, 2009 (Newswire.com) - Taking Loan against Property is not the end of your endeavor to raise fund for your property. After taking Loan Against Property your responsibility increases to your banker, because you have taken loan on your property. At the same time, there also has to be adequate amount of care taken in the entire transaction because if there is any mistake then the consequences can be large and there can be a big hit for the person taking the loan against property. In such a situation, the main disadvantages of a Loan Against Property are given below: Loss of ownership In case if you take a Loan Against Property, there is no way for any delay in terms of payment because you have given your valuable asset as security that is your property. You have to be very careful. If there is a default on the Loan Against Property then the person could find that the property has been taken over by the bank and this can mean a major shock for him/her in the form of loss of ownership. This is especially true if the person is living in the house that has been given as security and this is the main asset that is present with him/her. Every step has to be taken carefully and proper attention is required for the entire repayment process in case of loan against property. Higher amount in several cases, the loan against property is taken because the amount is available and in many instances the individual might be able to get a higher amount of the loan. However, this might become a problem as far as the entire repayment process in a Loan Against Property is concerned and in such a situation the high loan amount becomes a financial problem for the individual. The money might be used for purposes that are not essential; this has to be avoided and the right amount of loan that is affordable and can be repaid should be taken.