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  • Loan Against Property

    Loan Against Property scheme is a secured personal loan which you can avail by pledging your property as a security or a collateral. These personal loan schemes are also known as mortgage loans. Loan Against Property interest rates range between 8.45% p.a. to 22% p.a. You can avail loans of up to Rs.25 crore for a tenure of up to 20 years with LAP.

    Loan against Property Details

    Interest Rate 8.45% p.a. onwards
    Loan Amount Up to Rs.25 crore
    Loan Tenure Up to 20 years
    Processing Fee 1% - 3% of the loan amount + GST

    Best Loan Against Property Schemes

    Bank Interest Rate Loan Amount Tenure
    State Bank of India 8.45% p.a.- 10.00% p.a. Up to 7.5 crore 5-15 years
    ICICI Bank 8.90% p.a. - 9.10% p.a. Up to Rs.5 crore Up to 15 years
    HDFC Bank 9.25% p.a. - 10.35% p.a. Up to 65% of the value of the property Up to 15 years
    IDFC First As per the terms and conditions Rs.5 lakh – Rs.10 crore Up to 20 years
    Tata Capital 10.10% p.a. onwards Rs.10 lakh – Rs.3 crore Up to 15 years
    Axis Bank Up to 11.25% p.a. onwards Rs.5 lakh – Rs.5 crore Up to 20 years
    Kotak Mahindra Bank At the discretion of the bank Rs.10 lakh – Rs.5 crore Up to 15 years
    IIFL 11.50% to 22% p.a. Up to Rs.10 crores Up to 10 years
    Edelweiss Financial Services Ltd As per the terms and conditions Up to Rs.25 crore Up to 15 years

    *The interest rate depends on loan amount availed by the customer as well as the type of loan scheme and several other factors based on the terms and conditions of the lender.

    Factors affecting Loan Against Property interest rate

    • Loan Tenure - The repayment tenure determines the interest rate charged by the bank. Shorter the repayment tenure, higher will be the rate of interest charged.
    • Credit Score - You must have a credit score of 700 and above if you wish to avail a loan against property at lower rates of interest.
    • Type of property - The market value and the type of property determines the interest rate charged by the lender.
    • Profile of the applicant - The age, occupation, income, etc. also determines the interest rate charged by the bank.

    SBI Loan Against Property

    Key Features:

    • Offered to customers with residential and commercial properties.
    • The minimum loan amount that can be availed is Rs.10 lakh and the maximum loan amount is Rs.7.5 crore.
    • Processing fee is set at 1% of the loan amount plus service tax, subject to a maximum of Rs.50,000 plus service tax.
    • To be eligible for the SBI Loan Against Property, the applicant should have a minimum monthly income of Rs.25,000 or Rs.3 lakh p.a.
    • No prepayment penalties with the SBI Loan Against Property.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    SBI 1% Nil The loan should be liquidated before the eldest borrower reaches 70 years of age.

    ICICI Loan Against Property

    Key Features:

    • Special offers for doctors.
    • The maximum loan amount that can be availed is up to 70% of the property value – subject to the terms and conditions set by ICICI Bank.
    • Salaried and self-employed individuals are eligible to avail the ICICI Bank Loan Against Property scheme.
    • The minimum loan amount that can be availed is Rs.10 lakh while the maximum loan amount that can be availed is Rs.5 crore.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    ICICI Bank 1% At the discretion of the bank Contact bank for information

    HDFC Bank Loan Against Property

    Key Features:

    • Resident Indians who are salaried or self-employed are eligible for this loan scheme.
    • Flexible loan tenures up to 15 years.
    • Quick and hassle-free documentation process.
    • The borrower can use his/her residential or commercial property as collateral to avail the loan.
    • Simple monthly installments repayment options.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    HDFC Bank 1% of the loan amount NIL Contact bank for information

    IDFC First Loan Against Property

    Key Features:

    • Loans of up to Rs.10 crore.
    • Flexible loan tenures up to 20 years.
    • Loans offered to borrowers with commercial properties, small and medium enterprises (SMEs), residential plots, or those with a rental income.
    • Salaried and self-employed individuals are eligible for this loan scheme.
    • IDFC First offers secured loans up to Rs.10 crore.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    IDFC First As per the terms and conditions As per the terms and conditions As per the terms and conditions

    Tata Capital Loan Against Property

    Key Features:

    • Quick and hassle-free documentation and approval process.
    • Wide range of collaterals – residential, commercial properties, etc.
    • Pre-qualified loan top-up.
    • Availability of the overdraft facility.
    • Competitive interest rates and flexible repayment plans.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    Tata Capital 1.25%-2% + GST of the loan amount 4% + GST 25 years to 60 years

    Axis Bank Loan Against Property

    Key Features:

    • Loans starting at Rs.5 lakh.
    • Overdraft facility available.
    • Transfer existing loan to Axis Bank.
    • Flexible tenure options with attractive interest rates.
    • Loans offered for as low as Rs.5 lakh.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    Axis Bank 1% of the loan amount or Rs.10,000 whichever is higher At the discretion of the bank Contact bank for details

    Kotak Mahindra Bank Loan Against Property

    Key Features:

    • The Kotak Mahindra Bank Loan Against Property can be availed for purposes such as education, travel, and other personal expenses.
    • Applicants can use their residential property, commercial or industrial properties as collateral.
    • Flexible eligibility criteria.
    • Interest rates are lower than usual personal loan products.
    • Hassle-free online application process.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    Kotak Mahindra Bank Maximum 3% of the loan amount + GST 4% + GST Between 21 years and 65 years

    IIFL Loan Against Property

    Key Features:

    • Minimum documentation required during the application process.
    • Quick loan approval.
    • Flexible repayment options.
    • Doorstep banking available.
    • Loans of up to 70% of the value of the property.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    IIFL Up to 2% of the loan amount NIL 18 years to 65 years

    Edelweiss Loan Against Property

    Key Features:

    • Quick online application process.
    • Loan amount you can avail will be at the discretion of the bank
    • Minimum documentation required to avail the loan.
    • Flexible tenure options. Tenure will depend on factors such as loan amount, interest rate, etc.
    • Competitive interest rates on the borrowed sum.
    Bank/Lender Processing Fee Pre-closure Charges Age Criteria
    Edelweiss Financial Services Ltd. 1% of the loan amount At the discretion of the bank As per the terms and conditions set by Edelweiss Financial Services Ltd.

    Eligibility criteria for Loan Against Property

    Type of property The property should be in India, be it a residential or commercial property.
    Minimum and maximum age 25 to 65 years
    Employment type Salaried or Self-employed
    Net monthly income Rs.25,000 minimum monthly income
    Others Legal property documents authorized by the Government of India - Registration Certificate, Property Tax Receipts, Sales Deed, etc.

    Documents required to apply for the Loan Against Property

    Proof of Identity PAN card, Passport, Driving License, etc.
    Proof of Address Passport, Electricity Bill, Aadhaar card, etc.
    Property Documents Copy of original sale deed, allotment-possession letter, NOC from society.
    Income Proof Latest Income Tax Return Certificate, Form 16, salary slips, audited financial sheet, certificate of practice, qualification certificate, Shop Act License, Sales Tax Certificate, etc.
    all about loan against property

    How to apply for Loan Against Property?

    • The customer has to visit the website of the financial lender and apply for the loan online.
    • The customer support team of the lender will get in touch with the applicant and request for the submission of relevant documents.
    • The lender will then verify the documents submitted and then inspect the property of the applicant.
    • If the application is approved, then the loan amount will be credited in the bank account of the customer.

    Features and Benefits of Loan Against Property

    • Lower rate of interest: Secured loans usually have a lower rate of interest when compared to unsecured loans. In addition to that, if you have a good credit score and credit history, the chances of you getting a loan at a low rate of interest goes up.
    • Simple documentation and approval process: The process of documentation and approval of loans is generally simple when it comes to a loan against property. The property against which the loan is availed acts as collateral in this case. This allows lenders to go forward with an easy documentation process.
    • Flexibility in repayment of the loan: Most loans against property offers a flexible loan repayment tenure. On the basis of the lender that you choose, you can avail a loan repayment tenure of as long as 20 years.
    • Continuous ownership of the property: In case of a loan against property, the ownership of the property is retained with the borrower. When you offer your property as a collateral for a loan, the ownership does not change. This also allows you to sell the property in case you are unable to repay the loan.
    • Availability of pre-closure option: You have the option to pre-close your loan against property if you wish to do the same. If the loan that you have availed comes with a variable interest rate, you will not be required to pay any penalties for the pre-closure of the loan. However, you will be required to pay a nominal amount if your loan was on fixed interest rate.
    • Optimal utilisation of the property: In case you avail a loan and you have a property which you offer as a collateral, you get to satisfy your financial needs with the loan amount which will be at par with the property. At the same time, you also get to retain your property. You can decide to not sell your property and still avail enough money to meet your requirements that too at affordable rates of interest.

    FAQs on Loan Against Property

    1. Is it possible to apply for a Loan Against Property if it is a joint property?

      Yes, it is possible provided that the co-applicant of the loan is the joint owner of the property. In fact, a higher loan amount can be availed for joint properties.

    2. Is there an application fee for Loan Against Property?

      Financial lenders have a set application fee which includes the charges to evaluate the property and the legal verification process.

    3. Do lenders offer Loan Against Property schemes for Non-resident Indians?

      Yes, some lenders offer the Loan Against Property for Non-resident Indians as well, but it depends on the terms and conditions set by the lender you wish to avail the loan from.

    4. How will I know if my Loan Against Property application is approved?

      Using your application reference number, you can check the status of your loan application on the website of the lender. If the loan is approved, you will receive a message on your registered mobile number that your loan has been approved and that the money will be credited to your account shortly.

    5. Is there a specific purpose that I should mention to avail such a loan?

      Customers can opt for the Loan Against Property for business purposes, personal reasons or debt consolidation.

    6. Is the interest rate for the Loan Against Property standard between lenders?

      No, the interest rates offered by lenders vary.

    7. How can I avail the best loan against property scheme?

      Some of the ways through which you can avail a loan against property scheme suitable for you are given below:

      • Check your eligibility criteria before applying for a loan.
      • Make sure you have all the correct documents.
      • Compare the loan schemes offered by different lenders.
    8. Is there moratorium offered by banks on Loan against Property?

      Yes, as per the directive by the Reserve Bank of India (RBI), banks in India are offering moratorium on EMIs due between 1 June 2020 to 31 August 2020. The bank will not charge any late payment charges during the moratorium period. However, it must be noted that the interest on your loan will continue to get accrued and you will end up paying more towards interest, thereby further increasing the total cost of your loan. Hence, it is recommended that you opt for loan moratorium only if you are facing a severe financial crunch.

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