Loan Against Property for Personal and Business Use
Loan Against Property
Loan Against Property (LAP) can be availed to meet your personal or business needs. Residential and commercial properties can be mortgaged for availing a loan against property with leading banks i.e. HDFC Bank, ICICI Bank, State Bank of India. Loan Against Property is a simple solution with smooth & hassle-free process for both salaried and self-employed individuals to meet your financial needs.
Whether you own a residential, commercial or special use property, it is can be used as collateral for Loan Against Property, when you have a financial requirement. Whether its a business expansion, child’s higher studies, wedding or medical emergency You can unlock potential of you property to get funds anytime, but it can be settled conveniently, if you own a property. You can easily secure a Loan by mortgaging your property. Your property can help fulfil your dreams. Avail a mortgage loans at lower interest rates.
Loan Against Property EMI Calculator
Loan Against Property Interest Rates
Loan against property Interest rates in India vary across lenders/banks. LAP loans Interest rates are typically ranging from 8.50% to 18% per annum. Applicable interest rates are appraised by credit team. These rates are influenced by factors such as the loan amount, property type, applicant’s credit profile, and the lender’s policies. Interest rate for loan against property is finalized after reviewing customers credit worthiness i.e. CIBIL Score. a good CIBIL score always helps with low interest rate, Loan amount, Loan tenor, Customer business profile etc.
Loan Against Property Interest Rates remains in the range of 9.50% to 13% with most of the banks, whereas interest rate for loan against property with HFC and NBFC stands in the range of 10% – 18% based on customer risk profile and loan amount. Here are some current offerings from various banks and financial institutions:
State Bank of India (SBI): Starting from 8.50% per annum.
HDFC Bank: Floating rates between 9.50% and 11.00%; fixed rates from 11.80% to 13.30%.
Axis Bank: Rates ranging from 10.50% to 10.95%.
Bank of Baroda: Rates between 9.70% and 18.60%.
ICICI Bank: Rates from 10.85% to 12.50%.
Tata Capital Housing Finance: Starting at 9.00% per annum.
SMFG India Credit: Retail Prime Lending Rate (RPLR) is 20.80% as of April 1, 2024, with specific rates depending on various factors.
If you are interested, let us know, and We can help you with specific lenders, procedures, or comparisons!
Eligibility Criteria for Loan Against Property (LAP)
To qualify for a Loan Against Property (LAP), borrowers must meet certain requirements, which vary slightly between lenders. Below are the common criteria:
1. Age
- Salaried Individuals: Typically between 21 to 60 years.
Self-Employed Individuals: Usually between 25 to 65 years.
The maximum age is calculated at the end of the loan tenure.
1. Age
2. Employment/Income Stability
- Salaried Individuals:
- Stable employment with a minimum of 2-3 years of work experience.
- Regular monthly income meeting the lender’s threshold.
- Self-Employed Individuals:
- Minimum of 3 years in the current business.
- Demonstrated consistent income with financial records.
3. Credit Score
- A good credit score (700+ on a scale of 900) is preferred.
- A higher score increases the chances of approval and better interest rates.
4. Property Type and Ownership
- Eligible Properties:
- Residential, commercial, or industrial properties.
- The property should be owned by the applicant, either singly or jointly.
- Clear Title:
- The property must have a clear and marketable title without legal disputes.
5. Loan-to-Value (LTV) Ratio
- Lenders typically approve 50% to 70% of the property’s market value as the loan amount.
- LTV depends on the property’s condition, location, and market demand.
6. Income and Repayment Capacity
- The lender evaluates the applicant’s income to ensure the ability to repay.
- Debt-to-Income Ratio: Total monthly obligations (including EMIs) should ideally not exceed 40%-50% of the monthly income.
7. Co-Applicants (Optional)
- Adding a co-applicant (spouse or close family member) can enhance eligibility.
- Co-applicants must also meet the lender’s criteria.
Additional Considerations
- Nationality:
- Only Indian residents and, in some cases, Non-Resident Indians (NRIs) are eligible.
- Property Location:
- The property must be located in an area approved by the lender.
- Existing Liabilities:
- Outstanding debts or ongoing loans can impact eligibility.
Would you like help determining your eligibility, calculating your loan amount, or finding lenders?
Loan Against Property Documents Required
Identity Proof: Aadhaar card, PAN card, passport, or voter ID.
Address Proof: Utility bills, rent agreements, or passport.
Income Proof: latest 3 months Salary slips, Last 2 Years Form 16 / ITR and Bank Statements are required for salaried customers. Last two financial years ITRs, Balance Sheets and P&L Statements along with bank statements are required for Self Employed customers.
Property Documents: Title deed, property tax receipts, and valuation report.
Frequently Asked Questions (FAQs)
What is a Loan Against Property (LAP)?
A Loan Against Property is a Secured Loan provided by financial institution against property as collateral, where you can mortgage your residential, commercial or special use property to get immediate funds. You can use these funds for any purpose from business expenditure to personal needs like marriage, medical expenses and child’s education etc. Existing Loan Against Property from other banks and financial institutions can also be transferred to other Bank. In LAP, the property you own, which has a clear title, is kept with financial institution or Bank as a collateral or security, to help you get financial assistance.
Who can avail a Loan Against Property (LAP)?
What is the maximum term for which I can avail a Loan Against Property (LAP)?
You can avail a loan against property for a maximum term of 15 years or till your age of retirement ,whichever is lower.
