Residential
Key Features
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As the term implies, a Loan Against property is a method of securing finance from a Bank or an NBFC by giving your property as collateral. Creating an asset requires hard work and perseverance. Whether it be a house or a commercial property, there are many rewards for ownership. Besides giving you the comfort and identity of a lifetime, a property can be mortgaged to advance your dreams or be used in an emergency for personal, educational, or business purposes.
Key Features
Key Features
Key Features
A loan against your property can help you address financial shortages when needed for business purposes, such as expanding operations, purchasing machinery, or fulfilling existing obligations.
Are you looking to renovate your home or construct extra space for your family? A Loan against your existing property is available for diverse needs to upgrade your lifestyle.
The flexibility of using funds allowed with a mortgage against your property helps you fulfil personal needs such as wedding expenses and family obligations.
Reasonable Loan Against Property interest rates are the answer to repaying your credit card debts, an overdue app loan that charges exorbitant interest for delayed payments.
A mortgage is required to receive funds as an education loan: do not let financial constraints hold you back from allowing your child to study in a prestigious institution with a Loan against your property.
If an emergency arises unexpectedly, your property can be your saviour by providing the funds needed to cover medical expenses. You can apply for a loan against your property.
| Loan Types | Loan Against Property (LAP) Loan Against Rent Receivables (LRR) |
Dropline Overdraft Against Property |
|---|---|---|
| Item | Charges | Charges |
| Floating Interest Rate | Repo Rate + 3% (9.5% to 11%) | Applicable for operating limit only. Overdraft funds charged at 18% per annum. |
| Fixed Interest Rate | 11.80% to 13.30% | Not Applicable |
| Processing Fees | 1% of loan amount (Minimum ₹7500) | 1% of loan amount (Minimum ₹7500) |
| Part Payment Charges | ||
| 25% of principal prepaid in 12 months | NIL | Not Applicable |
| For individual end usage | NIL | Not Applicable |
| For Macro & Small business enterprises | NIL | Not Applicable |
| Prepayment in excess of 25% of Principal | Charges are applicable with 2.5% GST | Not Applicable |
| Foreclosure Charges Floating Interest Rate | ||
| Floating Interest Rate | Maximum 4% of the operating limit if closed within 12 months from disbursement date. | - |
| Individual Borrowers | - | - |
| Business Purposes | 2.5% of the principal balance | - |
| > 60 months of loan disbursement | NIL | Post 12 months 2% of the operating limit. |
| Non-Business Purposes | NIL | - |
| Non-Individual Borrowers | 2.5% of the principal balance | - |
| > 60 months of loan disbursement | NIL | - |
| Foreclosure Charges Fixed Interest Rate | ||
| Fixed Interest Rate | 2.5% of the Principal outstanding. | Not Applicable |
| > 60 months | NIL | - |
| Small or Microloan below ₹ 50 lakhs | NIL | - |
| Other Charges | ||
| Stamp Duty | As per the state laws | - |
| Delayed EMI Charge | 18% + taxes applicable. | - |
| Payment Return Charges | 450/- | - |
| Charges for Copy of Amortization Schedule | 50/- | - |
| Repayment Mode Change | 500/- | - |
| Legal, Incidental and Repossession Charges | At Actuals | - |
| Annual Maintenance Charges (AMC) | Not Applicable | ₹ 5000/- plus taxes for DOD account. |
| Commitment Charge for Overdraft Account | Not Applicable | Quarterly Charges if average utilization is <30% of Overdraft limit. |
HDFC Bank provides a Loan Against Property to Indian nationals as per the following criteria.
| For Salaried and Self Employed Professionals. | Floating Interest Rate |
|---|---|
| Upto ₹ 50 Lakhs | 11.35% - 12% |
| Above ₹ 100 Lakhs | 10.85% to 11.50% |
| For Self-Employed Customers. |
|
| Processing fees | 1.5% of the loan amount or 11000/- ( which is higher) |
| Prepayment Charges | Nil after 12 months / 4% if end use is for business. |
| Conversion Charges | 0.5% of the loan amount. |
| Administrative Charges | Upto 2.5% of loan amount + GST or 5000/- + GST whichever is lower. |
A Loan Against Property is provided as per the following criteria.
| Rate of Interest: | 11% Onwards |
|---|---|
| Processing Fees: |
|
| Part Payment: |
|
| Foreclosure: |
|
| Non-Utilization Charges: | NA |
| Renewal Charge: | NA |
| Penal Charges: |
|
| Stamp Duty and Other Charges: | As per applicable laws of the state |
| Cheque Bounce Charges: | ₹ 339/- each instance |
| Cheque/Instrument Swapping Charges: | ₹ 500/- |
| Charges for switching from higher floating interest rate to a lower floating interest. | |
| On Principal outstanding at the time of conversion | Charges |
| Upto ₹ 10 Lakhs | ₹ 1000/- + GST |
| ₹ 10.1 Lakhs to ₹ 30 Lakhs | ₹ 2000/-+ GST |
| ₹ 30.1 Lakhs to ₹ 75 Lakhs | ₹ 3000/- + GST |
| ₹ 74 Lakhs and above. | ₹ 5000/- + GST |
Switching from floating to fixed rate of interest Charges = 1% of principal outstanding ( with 1000/- minimum)
Switching from fixed rate to floating rate of interest Charges = 2% of the principal amount outstanding.
(GST is applicable on all charges as per the state laws)
*Charges are subject to change and are applicable as per the terms and conditions of AXIS Bank
| * Overdraft Against Property | |
|---|---|
| Foreclosure: | 2% foreclosure charges + GST applicable on the overdraft limit for the year. |
| Non-Utilization Charges: |
|
| Renewal Charge: |
|
| Penal Charges: |
|
AXIS Bank processes a Loan Against Property as per the following criteria:
| Terms and Conditions | ||
|---|---|---|
| Loan Amounts offered as a LAP | ₹5 Lakshs to ₹10 Crore | |
| Tenure for Repayment | 12 to 240 months | |
| Loan Amount Offered as a Micro LAP | ₹3 Lakhs to ₹20 Lakhs | |
| Tenure for Repayment | 12 to 120 months | |
| Rate of Interest: | ||
| Floating Rate | 9% onwards | |
| Fixed Rate | 13% onwards | |
| Micro LAP | 17% to 33% | |
| Processing Fees for LAP | 1% to 3% of Loan Amount + GST | |
| Application Fees | ||
| Upto 1 Crore | ₹3000/- | |
| Above 1 Crore | ₹5000/- | |
| For Micro LAP | ₹2000/- | |
| Foreclosure Floating Interest Rate | Within 12 Months | After 12 Months |
| Loan Amount Issued for Individual Usages | Nil | Nil |
| Loan Amount Issued for Business | 6% | 4% |
| Part Payment Floating Rate of Interest | ||
| Loan Amount Issued for Individual Usages | NIL | NIL |
| Loan Amount Issued for Business | Upto 25% of sanctioned amount can be prepaid free of charge.
For more than 25% prepaid during the tenure, 4% charge on the excess amount. |
|
| Foreclosure Charges Fixed Rate of Interest | Within 12 Months | After 12 Months |
| Individual and Business Usages | 6% | 4% |
| Part Payment | Upto 25% of sanctioned amount can be prepaid free of charge. For more than 25% prepaid during the tenure, 4% charge on the excess amount. |
|
| Legal and Technical Charges for LAP | ||
| Upto 1 Crore | ₹6000/- per property | |
| Above 1 Crore | ₹11000/- per property | |
| For Micro LAP | ₹4000/- | |
| Default in Payment for LAP | 3% per month on overdue amount | |
| Micro LAP Dishonour Fees | ₹600/- | |
| Return of Cheque or EMI Bounce Charges | ₹600/- + GST | |
| Mandate Rejection Charges | ₹450/- + GST | |
| Annual Maintenance Charges | ||
| Dropline OD Facility | ₹10,000/- | |
| Term Loan | ₹2000/- | |
| Cancellation Charges for LAP | ₹25,000/- | |
| Cancellation Charges for Micro LAP | 2% of loan amount or ₹5750/- whichever is higher | |
The Eligibility Criteria for a Loan Against Property from TATA Capital.
| Interest Rate | 9% to 12% per annum |
|---|---|
| Processing Fees | Up to 3.54% of the loan amount (inclusive of taxes) |
| Documentation Charges | Up to ₹2360/- (inclusive of taxes) |
| Prepayment Charges | Up to 4.72% on the outstanding amount (inclusive of taxes) |
| Annual Maintenance Charges | Up to 0.295% of the loan amount drawn in the initial year (inclusive of taxes) |
| (For Flexi Hybrid Loan) | |
| Bounce Charges | ₹1500/- |
| Stamp Duty | Applicable as per the state laws |
| Mortgage Origination Fee | Up to ₹6000/- |
| Conversion Fee | Up to 1.18% of the total principal outstanding |
| Floating to Fixed | |
| Fixed to Floating | |
Bajaj finances issues a Loan Against Property to all Indian citizens as per the following criteria:
With a Loan Against Property or LAP, as it is popularly known, you can unlock the value of your asset with a mortgage and receive funds to fulfil personal and professional needs. Most banks and NBFCs offer loans against property or property mortgages and are happy to forward large amounts with security in hand. Individuals are also content to receive the amount as desired.
The flexible repayment term of 1 to 15 years for a Loan against property allows an applicant to repay the loan amount according to their financial eligibility to afford the EMI. An applicant can work out a suitable EMI with the help of a Personal Loan EMI calculator online. A foreclosure is permitted after paying 12 EMI with no extra charge.
The interest rate for an LAP is lower than that of unsecured loans. For a mortgage, Banks offer the option of a fixed rate or charge interest at a floating rate linked to the PLR or the Prime lending rate of the RBI (Reserve Bank of India). With the change in RBI norms, an applicant can take advantage of a reduced interest rate over the tenure.
An applicant can use the funds received via an LAP to fulfil obligations such as further education expenses for self or family, renovating or reconstructing your home, dealing with medical emergencies, and even debt consolidation for credit cards that attract a high interest rate. A Loan Against Property enables you to fund your new business and provide finance for further expansion.
The need for finance comes unasked. It can be a business need or a medical emergency. In these situations, the hour's need is conveniently met with a loan against your self-owned property. Rather than sell an asset created with hard work and perseverance, you can raise the amount needed and keep your property's ownership intact.
A Loan Against Property offers a length of credit with a tenure of up to 15 years. An on-time repayment credit record of EMI paid over time portrays the applicant's ability to manage credit. This will help create a steady credit rating and CIBIL score, which helps to secure further credit when required at a reasonable interest rate.
Tax relief for salaried individuals: Individuals can claim tax benefits if the amount received as a loan against property is used to buy a new home or renovate or construct their existing home.
Tax relief for self-employed: Funds used for business purposes are eligible for tax redemption, which can be claimed against the interest paid on the Loan amount and other charges such as processing fees and insurance.
No tax relief is provided if the Loan amount issued against a property mortgage is used for marriage, further education or other personal funding.
The first step is determining whether the property's
value is adequate for the required loan amount.
Use the Loan Against Property Calculator to
find an easily affordable instalment.
The property documents, income, and KYC
documents should be available as originals.
When selecting a financier, choose the unique
selling proposition (USP) that best suits your needs.
A loan against property is a Loan issued by keeping a property as a security against a mortgage: the property involved could be a Land, Residential, Commercial or industrial establishment.
Funds that can be sanctioned as a loan depend on the value of the property and the income of the applicant/applicants.
A self-owned property that has been rented can be mortgaged if all the legal agreements and documentation are provided.
A Loan Against Property for Personal use is known as a Personal Loan for Property, and for Business use, it is called a Business Loan Against Property.
The time for which a property can be mortgaged or the repayment period for a Loan against property is from 1 year to 20 years.
Before releasing the loan amount, the financer will check and receive all original documents for safekeeping. The customer will be given a list of documents deposited with the Bank.
A loan against property is given against a plot of land or a built-up property, whereas a Loan for construction is forwarded for the specific purpose of construction.
A home loan is issued to initiate payment for a property used for residential purposes, whereas a Loan against property is appended for a self-owned and registered property.
A reverse mortgage is for seniors over 60 who want additional income in their twilight years.
A retired person can avail of a loan against property with a co-applicant who is a blood relative and is eligible to repay the EMI. The tenure of the loan may be restricted.
The CIBIL score of the applicant and the co-applicants will be considered when sanctioning a loan against the property; it should be above the required benchmark. The minimum score considered is 680+.
Inputs for a Loan Against Property Eligibility Calculator include the following:
By accessing the web page of the Lender, an applicant can apply for instant loans against property as:
An applicant can receive funds as a Loan Against Property for Business and Personal usages.
The Loan against property eligibility varies from Bank to Bank per the specific terms and conditions.
The Loan against Property EMI calculator is a standard EMI Calculator that can be used to arrive at a suitable EMI and tenure.
The interest rates of premier Banks are all governed by the RBI repo rate, such as:
If income proof is unavailable, an applicant can apply for Loan Against property based on the regular rent received from the premises.
