LAPs or Loans against Property are loans given against the mortgage of property. It is disbursed as a percentage of the market value of the property. These loans are secured loans where the borrower uses his property as security as a guarantee. LAPs are usually issued to applicants to meet expenses such as:
Equitas Housing Finance Limited, which is a wholly owned subsidiary of Equitas Holdings Limited (formerly known as Equitas Micro Finance India Private Limited) makes loans against property available for informal salaried, unsalaried and self-employed customers who come under the bracket of general category customers.
Features of Equitas Loan against Property
Some of the main features of Equitas loans against property are:
The loan amount ranges from Rs 5 Lakh to Rs 50 Lakh
The tenure of the loan ranges from 3 - 15 years
17% - 18% diminishing rate of interest
The minimum entry age is 18 years and the maximum entry age is 60 years.
The maximum maturity age is 70 years.
It is mandatory to have a Life Insurance - Credit Shield for the loan outstanding amount.
Property insurance is also mandatory.
The loan will have to be repaid on a monthly repayment frequency.
Registration of memorandum of deposit and title deeds is mandatory
Rate of Interest for Equitas Loan against Property
The interest rate charged by Equitas on Loan against Property is a combination of fixed and floating rates as per the following parameters:
The interest rate will be fixed for the first three years
The interest rate will be floating for the remaining period of the loan and during this period the interest rate will be linked to Special Equitas Lending Rate (SELR)
The lending rates linked to Special Equitas Lending Rate is set at 13.5%
Fees and Charges
Equitas loans against property entail the following fees and charges:
For loans up to Rs 20 lakhs, a processing fee of Rs 5,000 is payable at the time of sanction.
For loans above Rs 20 lakhs, a processing fee of Rs 6,000 is payable at the time of sanction.
An administration fee of 0.75% of the sanctioned loan amount is charged at the time of disbursement of the loan.
A tech fee of 0.75% of the sanctioned loan amount is charged at the time of disbursement of the loan.
Pre-closure of the loan is allowed within 6 months.
The pre-closure charge is nil during the floating period, 3% for own funds during the fixed period and 5% for other sources during the fixed period.
Cheque bounce charges are Rs 500
Additional finance charges of 36% per annum on the amount overdue
CERSAI charges of Rs 250 for all loans up to Rs 5 lakhs and Rs 500 for all other loans.