You can get a loan to buy land just like you would for a home. A land purchase loan allows you to buy land by paying in installments, but keep in mind that you’ll also need to pay interest on it.
So, how much interest are we talking about? Generally, land purchase loans can be a bit pricier than home loans. While there are many similarities between the two, the interest rates for land loans tend to be higher. Typically, you might see annual interest rates ranging from 8.6% to 17%. Plus, the repayment period for land loans is usually shorter, lasting anywhere from 5 to 20 years.
Eligibility for a land purchase loan is pretty much the same as for a home loan. To qualify, you need to be at least 21 years old and not older than 65. You’ll also need to provide some documents when applying for the loan.
It’s important that the applicant has a stable income, whether through a fixed salary or self-employment. Additionally, the monthly salary should be at least 10,000 rupees, although there may be some variations in the rules.
If you’re self-employed, you can make up to Rs 2 lakh a year. Additionally, having a good credit score is essential if you want to secure a loan. Here’s what you’ll need:
For identity verification, you can provide an Aadhaar card, an ID card, or a PAN card. To prove your address, you can use a ration card, utility bills (like electricity or water), or a lease agreement. You’ll also need to submit your bank statements from the last six months as proof of income. If you’re self-employed, make sure to include your latest income tax assessment as well. Plus, don’t forget to provide your land tax receipt, title deed, and any other documents the bank may require.
So, what exactly is a land purchase loan?
In today’s world of rising prices, loans have become a way to buy the things we want. With a loan, you can make purchases in installments, but keep in mind that you’ll be paying interest on it. We’re familiar with loans like home loans, personal loans, and education loans, but you can also get a loan specifically for buying land from a bank or financial institution. This is known as a land purchase loan, and typically, the interest rates for these loans are higher than those for home loans.