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Sundaram BNP Paribas Loan Against Property

Sundaram BNP Paribas Loan Against Property

4

Max Tenure

10 yrs

Best Rate

14.5%

Processing Fee

Nil

ICICI Bank Loan Against Property

ICICI Bank Loan Against Property

4

Max Tenure

10 yrs

Best Rate

12%

Processing Fee

1%

Manappuram Finance Loan Against Property

Manappuram Finance Loan Against Property

4

Max Tenure

5 yrs

Best Rate

22.00%

Processing Fee

1%*

TATA Capital Loan Against Property

TATA Capital Loan Against Property

4

Max Tenure

15 yrs

Best Rate

12.50%

Processing Fee

2%

Cholamandalam Loan Against Property

Cholamandalam Loan Against Property

4

Max Tenure

15 yrs

Best Rate

15.00%

Processing Fee

2%

SHUBHAM Loan Against Property

SHUBHAM Loan Against Property

4

Max Tenure

10 yrs

Best Rate

23%

Processing Fee

3%

Magma Fincorp Loan Against Property

Magma Fincorp Loan Against Property

4

Max Tenure

15 yrs

Best Rate

14%

Processing Fee

1.5%

Edelweiss Loan Against Property

Edelweiss Loan Against Property

4

Max Tenure

60 months

Best Rate

11%

Processing Fee

1.50%

L&T Finance Loan Against Property

L&T Finance Loan Against Property

4

Max Tenure

15 yrs

Best Rate

11.75%

Processing Fee

2%

India Bulls Loan Against Property

India Bulls Loan Against Property

4

Max Tenure

20 yrs

Best Rate

10.50%

Processing Fee

1%

RBL Loan Against Property

RBL Loan Against Property

4

Max Tenure

15 yrs

Best Rate

11.50% *

Processing Fee

1%

Home First Finance Company Loan Against Property

Home First Finance Company Loan Against Property

4

Max Tenure

20 yrs

Best Rate

14%

Processing Fee

1.5%

PNB Housing Finance Ltd Loan Against Property

PNB Housing Finance LTd Loan Against Property

4

Max Tenure

30 yrs

Best Rate

9.99%

Processing Fee

1%

LIC Housing Finance Loan Against Property

LIC Housing Finance Loan Against Property

4

Max Tenure

25 yrs

Best Rate

10.50%

Processing Fee

Rs.2500/-

HDFC Bank Loan Against Property

HDFC Bank Loan Against Property

4

Max Tenure

30 yrs

Best Rate

9.6%

Processing Fee

1.50%

Bank of India Loan Against Property

Bank of India Loan Against Property

4

Max Tenure

NA

Best Rate

9.70%

Processing Fee

nil*

Deutsche Bank Loan Against Property

Deutsche Bank Loan Against Property

4

Max Tenure

NA

Best Rate

24%

Processing Fee

nil*

DHFL Loan Against Property

DHFL Loan Against Property

4

Max Tenure

NA

Best Rate

12.50%

Processing Fee

nil*

Federal Bank Loan Against Property

Federal Bank Loan Against Property

4

Max Tenure

NA

Best Rate

11%

Processing Fee

nil*

HSBC Loan Against Property

HSBC Loan Against Property

4

Max Tenure

NA

Best Rate

10.15%

Processing Fee

nil*

IDBI Bank Loan Against Property

IDBI Bank Loan Against Property

4

Max Tenure

NA

Best Rate

12%

Processing Fee

nil*

Indian Bank Loan Against Property

Indian Bank Loan Against Property

4

Max Tenure

NA

Best Rate

9.45%

Processing Fee

nil*

Kotak Mahindra Bank Loan Against Property

Kotak Mahindra Bank Loan Against Property

4

Max Tenure

NA

Best Rate

13%

Processing Fee

nil*

Punjab National Bank Loan Against Property

Punjab National Bank Loan Against Property

4

Max Tenure

NA

Best Rate

12%

Processing Fee

nil*

State Bank of India Loan Against Property

State Bank of India Loan Against Property

4

Max Tenure

NA

Best Rate

13%

Processing Fee

nil*

Standard Chartered Bank Loan Against Property

Standard Chartered Bank Loan Against Property

4

Max Tenure

NA

Best Rate

9.25%

Processing Fee

nil*

Syndicate Bank Loan Against Property

Syndicate Bank Loan Against Property

4

Max Tenure

NA

Best Rate

12%

Processing Fee

nil*

Vijaya Bank Loan Against Property

Vijaya Bank Loan Against Property

4

Max Tenure

NA

Best Rate

11.90%

Processing Fee

nil*

Abhyudaya Co Operative Bank Loan Against Property

Abhyudaya Co Operative Bank Loan Against Property

4

Max Tenure

NA

Best Rate

13.50%

Processing Fee

nil*

Bajaj Finserv Loan Against Property

4

Max Tenure

NA

Best Rate

13%

Processing Fee

nil*

Capital First Loan Against Property

Capital First Loan Against Property

4

Max Tenure

NA

Best Rate

11%

Processing Fee

nil*

Corporation Bank Loan Against Property

Corporation Bank Loan Against Property

4

Max Tenure

NA

Best Rate

13.10%

Processing Fee

nil*

Dena Bank Loan Against Property

Dena Bank Loan Against Property

4

Max Tenure

NA

Best Rate

9.95%

Processing Fee

nil*

Dhanlaxmi Bank Loan Against Property

Dhanlaxmi Bank Loan Against Property

4

Max Tenure

NA

Best Rate

10.50%

Processing Fee

nil*

Indiabulls Loan Against Property

Indiabulls Loan Against Property

4

Max Tenure

NA

Best Rate

13%

Processing Fee

nil*

IndusInd Bank Loan Against Property

IndusInd Bank Loan Against Property

4

Max Tenure

NA

Best Rate

15%

Processing Fee

nil*

Oriental Bank of Commerce Loan Against Property

Oriental Bank of Commerce Loan Against Property

4

Max Tenure

NA

Best Rate

10.60%

Processing Fee

nil*

Union Bank of India Loan Against Property

Union Bank of India Loan Against Property

4

Max Tenure

NA

Best Rate

11.10%

Processing Fee

nil*

Allahabad Bank Loan Against Property

Allahabad Bank Loan Against Property

4

Max Tenure

NA

Best Rate

11%

Processing Fee

nil*

Central Bank of India Loan Against Property

Central Bank of India Loan Against Property

5

Max Tenure

NA

Best Rate

12%

Processing Fee

nil*

Citibank Loan Against Property

Citibank Loan Against Property

4

Max Tenure

NA

Best Rate

10.50%

Processing Fee

nil*

Fullerton India Loan Against Property

Fullerton India Loan Against Property

4

Max Tenure

NA

Best Rate

13%

Processing Fee

nil*

Bank of Baroda Loan Against Property

Bank of Baroda Loan Against Property

4

Max Tenure

NA

Best Rate

11%

Processing Fee

nil*

PIRAMAL Loan Against Property

PIRAMAL Loan Against Property

4

Max Tenure

nil*

Best Rate

Processing Fee

nil*

Sorry! We couldn't find any offer matching this category.

Loans Against Property

If you are in need of a significant amount of money and own property, then a Loan Against Property is an attractive, and relatively reasonable, credit option to consider. People often view a property as being of value only in bringing in rental income or selling at an appreciated price. It is often overlooked as an asset when raising funds for business or personal expenses. If you are in need of substantial funds, you can unlock the dormant potential of your property and raise funds at a relatively lower cost with this kind of loan.

How to Apply for Loan Against Property on CreditMantri.com

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For any of urgent financial requirements your property can be your savior. You don’t have to sell your property get the best deals on loan against your property from CreditMantri which will help your keep your property and also meet your financial needs.

What is a Loan Against Property?

A Loan Against Property is exactly what its name suggests – it is a loan where the bank or NBFC (Non-Banking Financial Company) lends you money and holds your property as security until the loan is repaid. Once you repay the loan in full, you get back your property. In case you fail to repay the loan, the lender can attach the property and dispose of it to recover the unpaid dues.

A Loan Against Property is a popular type of loan to take as it is one of the cheaper retail loans available. It is similar to a personal loan in that you can use the loan amount for any purpose – like debt consolidation, business expansion, education expenses, family or medical emergency. However, when compared to a personal loan, it offers a lower interest rate, and offers a larger loan amount over a longer repayment period. The key difference is that a Loan Against Property is a secured loan – the loan is secured by collateral - unlike a personal loan, which does not involve any security. This makes a Loan Against Property less expensive than a personal loan .

What is Property loan interest rates?

There are two types of interest rates:

Fixed rate of interest: The interest rate remains the same for the entire duration of the loan. Lenders usually offer this type of interest rate for a specific tenure of loan, and many may not offer this as an option at all for a loan against property.

Floating rate of interest: The interest rate changes according to prevailing market rates. Since the rate changes and is dependent on fluctuating market conditions, it is not possible to predict a typical rate.

The floating interest is linked to the Marginal Cost of Funds based Lending Rate (MCLR). The rates are typically published on the lender website and could change periodically.

How does the interest rate affect the EMI?

The floating interest rates could change on a regular basis, depending on your lender, leading to a potential change in your EMI as well. You may, however, choose to leave your EMI amount unchanged by changing the tenure of your loan. The longer the tenure, the lower the monthly EMI burden. If there is a change in the interest rate on your loan, you will be notified in advance by the bank. If you have chosen to repay your loan with post-dated cheques, you will need to pay the difference between the existing interest amount and the new interest amount separately.

Your EMI could also change if you make a partial prepayment on your loan. Full prepayment of the property loan is also possible in many cases. When making any prepayment – whether full or partial - keep in mind that it is subject to the terms and conditions of the loan regarding charges.

Benefits of a Loan Against Property versus a personal loan

Lower Interest Rate: Taking a ‘property loan’ – or more accurately a loan with property as security – is a cheaper alternative to other kinds of flexible end-use loans, like a personal loan. A Loan Property Loan is a secured loan which means that lenders can safeguard their lending risk with your property as collateral. On the other hand, personal loans are among the most expensive consumer loans to take as they are unsecured by any collateral. Generally, interest rates on a loan against property can range from 12-16% while interest rates on personal loans can range from 15-22%. Of course, each lender will fix the exact interest rate on your loan taking into account your credit profile, prevailing market rates and other internal policy regulations.

Larger loan amount: The size of the loan depends on the value of the property. Naturally, the more valuable the property, the larger the loan amount that will be sanctioned. Typically, you can get a loan for up to 60 % of the market value of the property and this can translate into a sizeable amount of funds. The loan amount on this type of loan is far larger than the amount you would get for a personal loan. Moreover, this larger amount comes at a lower interest rate than a personal loan.

Longer repayment period: Since it is a secured loan, lenders have a lower lending risk and are willing to grant a longer repayment schedule. The tenure for a loan against property can stretch up to 15 years while a personal loan has a tenure of only 1-5 years. A loan of this kind is advisable when you have a need for a substantial amount of funds which you can repay in the medium term.

Lower EMIs: Because of the longer loan period, the monthly EMI is also smaller, meaning it is a lighter repayment burden over the entire tenure of the loan. You might be able to get a similar sized personal loan amount but since the tenure is much shorter, and the interest rates are higher, the EMIs will be much heavier.

Loan Against Property

Other benefits of taking a Property Loan

Simpler documentation process – Since most of the paperwork is done at the time of buying the property, the documentation required for a loan against property is simple. All it requires is a clean title deed with no encumbrances – i.e. there should be no existing loans, mortgages or legal complications. Any of these have a negative impact on ownership and will make it very difficult, if not impossible, to secure the loan.

Leverages an existing asset – Like a gold loan, a loan against property allows you to leverage an asset that you already own. The property could be residential (house, apartment or plot of land), commercial or industrial.

End-use flexibility – A Loan against Property gives you the freedom to spend the loan amount for any purpose you wish, much like a personal loan or a gold loan .You can use it to expand your business (buy new machinery etc.), consolidate high cost debts, fund a child’s education domestically or overseas, or even to buy another property. Because of the larger loan size and the longer tenure, a loan against property is ideal for a substantial medium to long-term expense.

What are the criteria for Loan Against Property eligibility?

Each lender has its own criteria for Property Loan eligibility. However, in general, they could include:

  • Residency: Some lenders require that the applicant needs to be a resident of India. Other lenders do not have this restriction. Salaried NRIs can avail of a residential or commercial property loan subject to verification of property details.
  • Minimum net income – the criteria could be different for salaried and self-employed individuals
  • Minimum age: The minimum age too varies. Some lenders require the applicant to be at least 21 years of age, but more generally, the minimum age is 24 years at the time of sanction of loan. The maximum age too varies depending on the employment status – there could be different limits for salaried employees, government employee, or self-employed professionals. It typically ranges from 58 to 65 years and can even go up to 70 years with some lenders. The maximum age is the age of the applicant at the end of the loan repayment period.
  • Employment status: Includes self-employed individuals, salaried employees with the government or a reputed private company, or professionals, like doctors, engineers, architects, dentists, chartered accountants, management consultants with a regular source of income. Some lenders might have restrictions on employment status, for instance, restricting a Loan Against Property only to self-employed individuals.
  • Minimum loan amount: This again varies depending on the lender and which city the property is located.

The lender will make a decision on your eligibility based on the loan amount applied for, purpose of the loan, your ability to repay and the value of the property being mortgaged.

What are the documents required for a Property Loan Online?

It is necessary to get an accurate list of the required documents directly from your lender, but most lenders will require the following documents:

  • Application form. Some lenders allow you to download the form from their website. The application form generally includes your personal information, contact details, details of the property (location etc.), various costs involved in buying property, the loan amount and the tenure sought, and your income details. The cheque for the processing fee is usually submitted with the form.
  • Photograph
  • Identity Proof (could include passport, election/voter’s ID, permanent driving license, Permanent Account Number (PAN) card or Aadhaar Card
  • Address proof ( could include passport, election/voter’s ID, permanent driving license, Society outgoing bill (only from registered societies), electricity/water/telephone bill, Gas bill (pipeline connection only), Property tax bill, Domicile certificate with address issued by Municipal Corporation
  • Signature Proof
  • Date of Birth Proof
  • IT Returns & Balance Sheet & P/L Account statement for the last 2 years.
  • Business Continuity Proof for 5 years.
  • Bank Account Statements for the last 6 months
  • Copy of papers of property to be mortgaged

Note that there could be differences between the income documentation required from salaried employees and others.

What kinds of properties are eligible?

Residential properties are eligible, either self-occupied or rented out to a tenant. You cannot avail of a loan against property that you do not own, and that you pay rent on. It could be described as a mortgage loan against property owned.You can also avail of a LAP (Loan Against Property) for an empty unused plot of land.

You must have a clean title deed, with no encumbrances (like other loans, mortgage or litigation) which could adversely affect the title.

Commercial properties can also be used for a mortgage loan against property. Using a commercial property for loan will also require similarly clean property documentation.

If the property being mortgaged is under construction, then the bank usually disburses the loan in tranches or installments. Only interest will be levied on the amount that is already disbursed – i.e. you only need to pay interest on the amount you have received, you do not need to make payments towards repayment of the undisbursed loan amount. This is the Pre-EMI. Only once the full loan is disbursed, you will be liable to pay the regular EMI that includes both interest and principal repayment.

You will need to get all the property papers stamped according to local stamp duty laws. You will be responsible for all the costs relating to the property documents. You can ask your lender for the applicable stamp duty on your loan.

What is the maximum property loan amount and tenure?

There is no fixed minimum or maximum amount for a property loan, as this will vary with each lender. The amounts can range from a minimum of a lakh to a maximum of tens of crores. In general, you can expect to receive between 40- 60% of the market value of the property, with some lenders willing to go up to 70%. The market value is the price of the property if it were to be sold under current market conditions. The lender will decide the amount to be sanctioned based on a combination of factors including the amount required, ability to repay and the value of the property.

The tenure is also variable. These are also relatively long term loans and the repayment period is generally 15 years.

How do I pay the EMI?

You can pay your EMI in one of the following ways, depending on your lender and is gerneally similar to the payments made for a property or home loan.

Standing Instruction (SI): If you have an existing savings or salary account with the bank you have borrowed from, you can issue a standing instruction for the EMI to be deducted automatically every month from your account. If you do not have an account with the lending bank, you could open an account in order to facilitate this mode of payment.

Electronic Clearing Service (ECS): If you do not have an account with your lender, you could use this method for the EMIs to be paid automatically.

Post-Dated Cheques (PDCs): You could submit post-dated cheques for the EMI amount from another bank account. However, do keep in mind that several lenders offer only a floating interest rate on the loan against property. This means that if the interest rate is changed, your EMI could change as well and you will need to pay the difference separately. Alternatively, if you change the loan tenure, your EMI amount can continue as before even with a change in the interest rate.

Can I get a loan on property if the property is jointly owned?

Yes, you can get a loan on property even if it has multiple owners so long as all the co-owners are co-applicants for the loan.

Does the property need to be insured?

Most lenders require that the property is insured against fire and other hazards for the period of the loan. This is to keep the value of the pledged security intact in case of a natural disaster.

Is there any restriction on the location of the pledged property?

Some lenders might have a list of cities where the property needs to be located. However, it is best to check this detail with each individual lender.

Can I avail of a top-up loan on my existing LAP?

Yes, some banks will allow you to top up your existing loan once you have completed payments on your loan for a minimum period, usually six months.

How do I get the property that was pledged?

Once the entire loan amount (including interest) is repaid in full with no pending dues, the property held as collateral will be handed back by the lender. When the account is closed, you can collect the ownership documents from your lender, typically within a few weeks.

What are the consequences of defaulting on the loan?

It is always a bad idea to delay or skip payments on your EMI on any loan, whether a property loan or auto loan or personal loan. It can lead to serious legal consequences, financial loss and lack of access of credit in the future. Failing to make repayments could result in:

  • Damage to your credit score
  • Lack of access to loans or credit cards in the future from your existing lender and from other lenders as well
  • Initiation of legal and collection action by your lender to recover unpaid dues
  • Recall of the loan and sale of your property by the lender

How to apply for a loan against property online

To apply for a property loan online, you can download the application form from some of the lender websites. You can also call, sms or email the service centres to get in touch with a bank representative. Once you have submitted the application, the decision could take up to a few weeks.

How to get a Loan Against Property

If you are unsure about how to go about applying for the loan, or would like to learn more about which loan offer best suits your needs, CreditMantri can help you. We will study your loan requirement, the property details, your income and credit profile, and match you with the best possible offer on the market.

FAQS

1. Is loan against property a good idea?

Loan against property is a good idea if you want to fund a financial emergency. The benefits of a loan against property are a lower interest rate, repaying over a longer tenure, getting tax benefits on interest payments, and managing your big ticket purchases.

2. What is the eligibility for loan against property?

The main eligibility criteria for a loan against property are:
  • The age of the applicant should be between 18 to 70 years
  • The eligible salary should be Rs. 25,000 per month and above
  • The work experience for salaried should be 3 years and above

3. What are the documents required for loan against property?

  • Identity proof - Pan card, Aadhar card, or voter ID card
  • Address proof - passport, Aadhar card, voter ID card, landline bill, driving license, or registered rent agreement
  • Income proof - bank statement and ITR forms if you are salaried
  • Last 3 years income tax returns, profit and loss account, and balance sheets certified/audited by a CA if you are self-employed
  • Office address-ownership/lease/rent agreement/utility bill if you have contracted a commercial
  • Latest house tax return/receipt - approved building plan from municipal corporation

4. Is CIBIL™ required for loan against property?

Although Loan against property is a secured loan and your asset is pledged as a collateral, the CIBIL™ score is still important for loan against property.

5. What types of property cannot be used as security for loan against property?

  • Agricultural lands cannot be used as security.
  • Vacant lands or unused lands cannot be used
  • Buildings and property located in gram panchayat areas and unauthorized areas are not accepted as security by majority of banks
  • Property brought on power of attorney cannot be given as security in most parts of India.
  • Very small properties which are generally less than 600 square feet in size are not eligible as security.

6. What are the factors affecting loan against property interest rates?

  • Loan tenure
  • Credit score
  • Type of property
  • Profile of the applicant

7. Which are some of the best loan against property schemes?

Some of the best loan against property schemes are:
BankInterest RateLoan AmountTenure
State Bank of India 8.45% per annum to 10.00% per annumUp to 7.5 crores3 to 15 years
IDFC First7.5% p.a. onwardsUp to Rs.7 croreUp to 20 years
Tata Capital10.10% p.a. onwardsRs.10 lakh – Rs.3 croreUp to 15 years
Kotak Mahindra Bank9.5% p.a. onwardsRs.10 lakh – Rs.5 croreUp to 15 years
IIFL11.50% to 25% p.a.Up to Rs.10 croreUp to 10 years

Latest & Update Loan Against Property News

Yubi Loans Launches Digitized Loan Against Property30 Aug 2022

Yubi Loans, a well-known co-lending marketplace, has launched a digital Loan Against Property (LAP) offering. This new digital loan against property offering will allow SMEs to obtain access to multiple lenders in a single platform. The entire proces...

Read more

Yubi Loans, a well-known co-lending marketplace, has launched a digital Loan Against Property (LAP) offering. This new digital loan against property offering will allow SMEs to obtain access to multiple lenders in a single platform. The entire process encompassing onboarding, discovery, credit evaluation, and end-to-end processing of LAP will help SMEs obtain loans at competitive interest rates in just half the time taken to from traditional offline modes. The seamless and accelerated digital processing will create an ecosystem for SMEs to leverage their assets optimally and without hassle. As a result, they can now focus more on the growth of their business.

Edelweiss Housing Finance Collaborates with Standard Chartered Bank to introduce Co-lending for Loan Against Property11 Mar 2022

Edelweiss Finance has announced its co-lending partnership with Standard Chartered Banking for loan against property to MSME customers. The new partners have decided to sign the definitive agreements as per the RBI’s Co-lending Model. Here the EHFL w...

Read more

Edelweiss Finance has announced its co-lending partnership with Standard Chartered Banking for loan against property to MSME customers. The new partners have decided to sign the definitive agreements as per the RBI’s Co-lending Model. Here the EHFL will process the service of the loan and retain 20% of the loan on its book and the remaining 80 % is taken into the books by the Standard Chartered Bank. This partnership facilitates the bank to expand its lending portfolio. The new partners will lend loans against property to clients at the ratio of 20:80.

Bajaj Finserv Offers a Flexi Loan Against Property1 Jul 2019

Bajaj Finserv has come up with a Loan Against Property loan of up to Rs 1 crore for salaried employees and Rs 3.5 crore for self-employed in a matter of 4 days. To offer its customers more flexibility in repayment, Bajaj Finserv offers Flexi DropLIne...

Read more

Bajaj Finserv has come up with a Loan Against Property loan of up to Rs 1 crore for salaried employees and Rs 3.5 crore for self-employed in a matter of 4 days. To offer its customers more flexibility in repayment, Bajaj Finserv offers Flexi DropLIne Facility which allows multiple withdrawals from the sanctioned limit and interest is chargeable only on the withdrawn amount.

A loan against property can help you out of difficult situations6 May 2019

A loan can be availed against your property which can be put to use for any reason such as funding higher education, meeting wedding expenses, for starting -up a business or even for investing it in another property. Depending upon the property offe...

Read more

A loan can be availed against your property which can be put to use for any reason such as funding higher education, meeting wedding expenses, for starting -up a business or even for investing it in another property. Depending upon the property offered to be pledged and other factors like your creditworthiness, rate of interest on a loan against property can work out lower than a normal personal loan.

Loans Against Property19 Mar 2019

A loan against property is a good way of utilizing an illiquid asset like homes or commercial establishments to avail loans. These loans are generally granted at a Loan to Value of 60-65 %. However, when there is a meltdown in property prices in the ...

Read more

A loan against property is a good way of utilizing an illiquid asset like homes or commercial establishments to avail loans. These loans are generally granted at a Loan to Value of 60-65 %. However, when there is a meltdown in property prices in the market, the lender may ask the borrowers to make good the value by asking for more collateral.

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