Introduction – A loan against property, commonly referred to as a mortgage loan, enables customers to borrow money by implementing their personal, business, along with industrial properties. LAP, involving unsecured loans for personal reasons, may be used for personal as well as professional purposes other than speculation.
- Banking institutions as well as HFCs provide loans against property at modest rates of interest and for a maximum of twenty years. Given the circumstances surrounding the lending institution and the creditors’ credit profiles, the borrowing amount for LAP may exceed up to 70% of the market price of the property.
- A lot of lenders also provide Lease Rental Discounting (LRD) services that enable customers to obtain a loan by accepting their tenants’ leasing receipts as well.
Top Banks and HFCs offer loans against property and their Interest Rates
Lending Institution | Interest Rate Per Annum | Processing Charge |
1. BOI or Bank of India | 11.25% | 1%Min- Rs/ 5000, Max- Rs/ 50,000 |
2. Bajaj Housing Finance | 8.50-18.00% | Up to 1% |
3. Bank Of Baroda | 10.85-16.50% | Up to 1% |
4. Bank of Maharashtra | 10.20-11.70% | 1% on the amount of the Loan |
5. Federal Bank | 12.60% | 1% of the sanctioned limit, with a minimal amount of Rs. 3,000 |
6. HDFC | 8.95-10.25% | Maximum loan amount’s 1.50% or Rs 4,500, which is greater. |
7. Indian Bank | 10.00-12.60% | Up to 1% |
8. ICICI Bank | 10.85-12.50% | Up to 1% on Loan Amount |
9. IDFC First Bank | 8.75-16.25% | Up to 3% on Loan Amount |
10. Indiabulls Housing Finance | 9.75% | 1% |
11.Kotak Mahindra Bank | 9.15% | Up to 1% |
12. L & T Housing Finance | 9.60% | Up to 2% |
13. LIC Housing Finance | 9.50-11.55% | 0.5 % on Loan Amount |
14. PNB Housing Finance | 8.99-12.85% | 0.75 % on Loan Amount |
15. State Bank of India or SBI | 10.60-11.30% | Flat 1,000 Rupees |
16. Tata Capital | 10.10% | Up to 2% |
17.UBI | 10.50-13.15% | Up to 1% on Loan Amount |
When applying for a loan against property, you should satisfy the requirements for eligibility. Whereas the requirements for becoming eligible for LAP vary by provider, the following represent a number of basic requirements that must be met in order to be considered for a loan against property:
Loan against property /eligibility criteria
Residential Status | Indian Resident/ Non-Resident Indian |
Minimum Age | Min 18 Years |
Maximum Age | Up to 70 years |
Type of Employment | Salaried/ Professional Self-Employed/ Self-Employed Non-professional |
Minimum Salary Amount | At least 12,000 Monthly |
Annual Income | At least 1.5 Lakh per annum |
Work Experience | 1 year experienced in the current field |
Eligible Amount of Loan | Up to 25 Crores |
LTV Ratio | Up to Property Value’s 75% |
Credit Score | Usually, 750 or higher |
Type of Property | Residential/Commercial, along with industrial properties |
Use a loan against property EMI calculator prior to requesting a mortgage loan to determine the approximate EMI you are able to pay on a given loan amount, rate of interest, and duration. The costs you incur every month should not be impacted by your loan against property EMI, either.
Documents necessary for applying for a loan against property
1. Identity Proof (Copy of Passport/Voter ID/Driving License/PAN Card)
2. Proof of Age
3. Income Proof of Salaried Persons
4. Income Proof of Self-employed Persons
5. Records or the Documentation related to Property
How to Apply
Step 1: Include basic information which includes your phone number, the loan amount, along with property address.
Step 2: Review and select an offer from the available choices.
Step 3: Allow the loan professionals to contact you.
Only if the property getting mortgaged belongs to more than a single individual is a co-applicant required for a loan to be secured against the property. All partners in ownership of the property have to submit applications as co-applicants in this case.
A variety of lenders impose distinct requirements for the kind of property that can be used to secure the loan for a mortgage.
On the other hand, the majority of financial organizations acknowledge commercial, residential, and industrial property. It should be noted that the overall condition and age of this asset may have an impact on its authorization by the lending organization.
A loan against property typically has a term of a maximum of fifteen years. Though it may differ from one financial institution to the next.
Absolutely. A number of lenders provide loans against property to NRIs.