Loan Against Property: Eligibility Criteria, Interest Rate, Required Documents

Loan against Property (LAP) also called a mortgage loan, enables a borrower to get loan benefits against their personal, commercial or business property. Just like unsecured loans, LAP can also be parsed to fulfil temporary personal or business needs. Major banks and HDFCs offer loans against the property at low-interest rates for a term period of up to 20 years. So, the maximum loan amount can go as high as 70 per cent of the property’s market value.

Loan Against Property

All Details You Want to Know About Getting a Loan Against Property

Interest Rates Offered By Major Banks

LenderInterest Rates (p.a.)Processing Fees
Bank of India11.10% onwardsUp to 1% (Min. Rs 5,000; Max. Rs 50,000)
Bajaj Housing Finance9.85% – 10.80%Up to 1%
Bank of Baroda10.80% – 16.45%Up to 1% (Rs 8,500 upfront – Rs 75,000)
Bank of Maharashtra10.20% – 11.70%1% of loan amount
Federal Bank12.35% onwards1% of the limit sanctioned with a minimum of Rs. 3,000
HDFC9.35% – 12.25%Up to 1.50% of loan amount or Rs 4,500, whichever is higher
ICICI Bank11.10% – 11.75%Up to 1% of loan amount
IDFC First Bank8.75% – 16.25% (floating)
8.75% – 20.00% (fixed)
Up to 3% of loan amount
IDFC First Bank8.75% – 16.25% (floating)
8.75% – 20.00% (fixed)
Up to 3% of loan amount
Indian Bank9.45% – 12.35%Up to 1%
Indiabulls Housing Finance10.45% onwards1% onwards
Kotak Mahindra Bank9.15% onwardsUp to 1%
L&T Housing Finance9.60% onwardsUp to 2%
LIC Housing Finance9.10% – 12.25%0.5% of loan amount
PNB Housing Finance10.15% – 12.50%0.75% of loan amount (Max. Rs 1 lakh)
State Bank of India10.35% – 11.05%Flat Rs 1,000
Tata Capital9.85% onwardsUp to 2%
Union Bank of India10.25% – 12.90%Up to 1 % of loan amount (Min. Rs 5,000 & Max. Rs 1 lakh)
UCO Bank10.70% – 11.85%0.50% of loan amount (up to Rs 2 lakh)

Eligibility Criteria for Getting a Loan Against Property

  • The applicant should be a maximum of 70 years old and a minimum of 18 years.
  • This loan can be availed by salaried employees, self-employed Professionals and self-employed Non-professionals.
  • For salaried employees, the minimum monthly salary should be ₹12,000.
  • For the self-employed, the net annual income should be at least ₹1.5 lacks.
  • Also, a minimum of one year of experience is necessary for a particular organisation for any employee.
  • The maximum loan amount that can be borrowed from any lender is up to ₹25 Cr.
  • LTV or Loan to Value Ratio will be up to 75 per cent of the total value of the property.
  • The credit score to avail of LAP is required to be between 750 to 900.

Also read:

Govt is Likely to Set EPF Deposit Interest Rate at 8% for FY-2023

Documentations Required

  • For proof of identity: Passport Copy /Voter ID card /Driving License /PAN Card.
  • For residence proof: Ration card /Telephone Bill /Electricity Bill /Rental agreement /Passport copy /Bank Passbook or Statement /Driving License.
  • As evidence of age: PAN Card /Passport /any other certificate from a statutory authority.
  • Salary Proof: Copy of Form 16, latest payslips, IT returns (ITR) of the past 3 years and investment proofs.
  • Income proof for non-salaried: Details of ITR of last 3 years, Balance Sheet and Profit & Loss Account Statement of the Company/Firm, Business License Details and Proof of Business Address.
  • And other property-related documents.

Rishabh Sharma

Rishabh is an experienced content writer and editor, he is working for Viralbake to cover a diversified range of categories. His articles mainly focus on providing information, being a travel guide, educating others, and also making people aware of technology, after all, he is a technophile. When not writing he can be found gaming, watching movies, and travelling.

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