If you are short of cash for an urgent commitment, you have the choice of taking caveat loans. This loan is different from the other finance loan options. It is disbursed quickly to you and all you need is a real estate piece that you can show to the lender. The urgent caveat loan that you take can be repaid within the year or even rolled over. You can thus escape the delay and processes associated with the usual finance loan options.
The caveat loan is provided to you based on the real estate asset. This can be your house, plot of land, medical centre or the like. The loan is usually processed within 24 hours and that is the best aspect of this loan. You can repay the loan if you wish to even after a month, should you have the funds. Generally, the period of repayment is from between a month to a year. People repay the amount even earlier or if they are unable to, rollover the loan to a later date.
The advantage of this caveat loan is that it enables you to monetize your otherwise illiquid real estate asset. You get the money you want to tide over a requirement quickly without losing your real estate asset. When things get better, you can repay the amount and all is well.
However, there are times when the urgent caveat loan may not be settled in your favor as under:
- The requirement of finance has to be a genuine one.
- The property value of the asset has to be good enough as the creditor otherwise would be saddled with a dead asset. The desired value is 70-75% LVR.
- The existing debt level has to be within limits and not already high that makes it difficult for the creditor to get his money back.
- The exit strategy is usually a short one and within the year and the creditor should get the impression that the repayment will be done.
The urgent caveat loan represents a great opportunity for genuine businessmen who have a funding requirement that they cannot meet with their cash. The need can be for expansion, meeting a debt deadline or as a bridge loan to finance a requirement in the interim. Whatever be the reason, the caveat loan is an effective monetary instrument to fulfil that need.