This document compares personal loans and loans against property. A personal loan is an unsecured loan with minimal documentation but higher interest rates and shorter tenures of up to 60 months. A loan against property is secured by real estate collateral, allowing for larger loan amounts, longer tenures up to 15 years, and lower interest rates, but involves a more complex approval process and risks foreclosure if defaulted. While personal loans have simpler processing, loans against property generally offer lower rates and longer repayment terms. Both have benefits and drawbacks, so a thorough comparison is recommended based on individual needs and circumstances.

1. Personal loan (PL) vs. loan against property (LAP) –
Choose wisely

2. Understanding PL and LAP
• PL is an unsecured form of financing.
• LAP is a secured loan backed by real estate assets.

3. Benefits of LAP
• High loan amount.
• Repayment tenure up to 15 years.
• Due to high-worth collateral, interest rate is low.
• Can be used for various purposes.

4. Drawbacks of LAP
• In case of default, you may lose your property.
• No tax benefits.
• Approval process is lengthy.

5. Benefits of PL
• You do not need to offer any collateral.
• Minimal documentation required.
• Can be used to repay high-interest loans.
• Can be used for several purposes.

6. Drawbacks of PL
• Being unsecured, it has a high interest rate.
• If not used wisely, it can create unnecessary debt burden.
• Short tenure, up to 60 months.

7. Which is better – LAP or PL?

8. Processing time
• PL is approved quickly, while LAP approval takes time.

9. Interest rate
• LAP interest rate is lower than PL.

10. Loan amount and tenure
• LAP offers a higher loan amount than PL.
• LAP offers a maximum repayment tenure of 15 years, while PL’s
maximum tenure is 60 months.

11. Documentation
• Compared to LAP, documentation process for PL is simple.

12. Both LAP and PL have their own benefits and
drawbacks. Compare them thoroughly
before taking a decision.

13. Thank You !
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Hero FinCorp Limited
09, Basant Lok, Vasant Vihar, New Delhi - 110057
Tel. 18001024145
Email Id: Corporate.Care@HeroFinCorp.com
Website: https://www.herofincorp.com/
Know more: Loan Against Property vs. Personal Loan