For a practicing Chartered Accountant, who is either self employed or salaried, it is quite possible that he or she would want to move up and own their own CA firm one day. For that one would need a significant amount of capital. One could of course, opt for a business loan or a personal loan for CA but being unsecured loans, they would only grant a maximum threshold of Rs 35 lakhs from most banks and NBFCs like Bajaj Finserv. On the other hand, if a CA wants to get a loan against property, this amount would go up to Rs 2 crores and it is possible to fulfill almost every requirement with that amount of money. In fact, it is a requirement for NBFCs like Bajaj Finserv to own a property in one’s name to take a loan against property for chartered accountants so why not use the property to further increase the loan threshold.
Here is all you need to know about loan against property for Chartered Accountants:
- Firstly, CA loans against properties have to end- use restrictions- meaning that the amount can be used to finance the purchase of any high value assets like new premises, new office, new vehicles for business, making trips required for business or even finance one’s child education abroad. It is possible to meet all requirements through this loan.
- Depending on the value of the property, the loan can go up to Rs 2 crore. For that, one needs to get an evaluation of the property done by a registered government evaluator and architect. The bank or NBFC might also want to evaluate the property again and a loan amount is decided on based on the current value of the property.
- Once the papers are verified and all the other documents are submitted along with the loan application, like KYC documents, educational certificates, IT returns of the last three years, pay slips and others, mortgage documents, property dossier containing the history of the property, then the loan could get approved in as less as 48 hours.
- It is possible to opt for a flexi- loan facility to avail the loan. One could withdraw funds only when the need arises and then pay interest only on the amount withdrawn. One could also opt for pre- payment of the loan EMIs at no extra pre- payment charges. The tenure of the loan repayment could be between 12 months to 20 years, which gives a CA ample time to spread out the repayment.
- To be eligible for a loan against property for CA, one should have a Certificate for Practice for at least years and of course, own the house or property at the location where the Bajaj Finserv offices are located for the branch you are dealing with.
- The interest rate of CA loan is mostly in the range of 9.5% to 10%. Processing fees are 1%. There are no loan statement charges or part- prepayment charges in case of flexi- loans. For regular loans, 2 to 4% may be charged on the outstanding amount. Penal interest is 1% per month and EMI bounce charges are Rs 1000, applicable on the first EMI clearance. Annual maintenance charges are 0.25%.
Since the property is to be mortgaged during the tenure of the loan, many fear that their property might be confiscated if they are unable to pay off the loan. However, the loan repayment schemes are so good and well planned and can be highly customized to fit the financial position of the CA, there are hardly any chances that they would not be able to pay off the loan in future. Once the loan is paid, the property turns back to the CA and in the meantime, all the needs are taken care of. All one needs is a good repayment plan and everything works out just fine.
