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✓ Home Loan from ₹5 Lakhs To ₹5 Cr ✓ Multiple Lending Partners ✓ Attractive Interest Rates

Plot Loan or Loan for land purchase, is considered to be the ultimate option of financing for those customers who are looking to buy a piece/plot of land either to build something or add to a land investment portfolio. Plot loan interest rates also tend to be fairly attractive as well. They tend to start from as low as 7.85% per annum (p.a.) and can be paid back over a repayment tenure of up to 20 years.

Plot Loan Interest Rate 2022

The below table will give the reader an idea regarding the land loan interest rates 2022 that have been set by several Indian lending institutions.

 

Name of the Plot Loan Lender

Plot Loan Interest Rate

Processing Charges*

ICICI Bank

7.85% p.a.

Up to 1% of the loan amount + Applicable Tax

PNB Housing

8.99% p.a.

Up to 0.35% of the loan amount + Applicable Tax

Axis Bank

8.10% p.a.

Up to 1% of the loan amount + Applicable Tax

Bank of India

8.05% p.a.

Up to 0.40% of the loan amount + Applicable Tax

Canara Bank

9.50% p.a.

Up to 0.50% of the loan amount + Applicable Tax

HDFC Bank

8.10% p.a.

Up to 0.50% of the loan amount + Applicable Tax

SBI

8.55% p.a.

Up to 0.40% of the loan amount + Applicable Tax

YES Bank

8.95% p.a.

Up to 2% of the loan amount + Applicable Tax

 

Disclaimer: Current interest rates shown are indicative of market conditions and will vary based on your lock-in period, loan type, credit score, purpose, and loan to value ratio.

Loan for Land Purchase - Benefits and Features

Here are some of the features and benefits of a land loan:

  • The borrower can fund up to 90% of the land plot with the help of a plot loan

  • Relatively longer repayment tenure

  • Plot loan interest rates are generally very attractive

  • Generous Tax Benefit on Plot Loan under Sections 24 and 80C of the Income Tax Act

  • Availability of a plot loan balance transfer facility (Offered by a majority of the leading Institutes)

  • No Prepayment Penalty

  • Low Processing Fee 

  • Minimal Documentation Required

Loan for Land Purchase EMI Calculator

Using an EMI calculator online will indeed help the prospective borrower in knowing the amount that will have to be honoured at the end of every month as EMIs once the plot loan has been availed. All a hopeful borrower will need to do is enter the loan amount, followed by the tenure (In months), and then the plot loan interest rate and the processing fee. Post which, they must click on ‘Calculate’.

Eligibility Criteria for Land Loan

Before applying for a loan for plot purchase, the borrower must ensure that they meet the following plot loan eligibility criteria:

 

Age

Lower Limit: 18 years Upper Limit: 65 years

Nature of Work

Only Salaried and Self-Employed people can apply for a plot loan

Credit Score

The hopeful borrower must have a credit score of 750 or above

 

Over and above the information that was just presented to you, several other factors are taken into consideration. They are the likes of an applicant’s income, liabilities that are to be honoured and the assets that are owned, among others. All of these factors are carefully scrutinised by a lender at the time of them processing the loan for plot purchase application form.

Documents Required for Plot Loan

These documents will be required in order to apply for a Loan for Plot Purchase:

  • The application form that has been duly filled

  • A proof of age

  • A proof of income

  • A proof of address

  • Documents related to the Plot/land 

  • Approved layouts/drawings of the plot

Also, Check: Documents required for home loan

How to Apply for Land Loan

You can apply for a land purchase loan through Bajaj MARKETS itself. To do so, follow the below-mentioned steps:

  • Step 1: First, click on the ‘Apply Now’ button that you can see on the home page.

  • Step 2: Next, you will need to enter basic personal details and your contact information. Then, verify your identity with your one time password (OTP).

  • Step 3: Post that, you will be able to see the maximum land loan amount you can avail and the maximum amount of time you can pay it back in.

  • Step 4: After that, you will have to feed in your employment details, details related to your income, other  personal data and land-related information.

After submitting the application form, a representative will get in touch with you to take things forward.

Credit Score and Land Loan

If you need a land loan, it is important for you to have a very good credit score as it is an indicator of your repayment capability. It is, in fact, the first thing that the lender will see when your land loan application comes their way. Ideally, you should have a credit score of 750 or above to stand a good chance of getting a land loan. Anything lower than that, or worse, having no credit history at all can lead to unwelcome outcomes for you, such as unfavourable repayment terms or even the rejection of your land loan application.

How to Get Tax Benefit on Plot Loan

Under section 80C of the Income Tax Act, one can avail a tax deduction on their plot and housing loan. The same deals with the principal repayment and does not take the interest part of the home and plot construction loans into consideration. It must also be noted that a Land Loan borrower can avail for a tax exemption of up to ₹1,50,000 every year.

Check detailed Home Loan Tax Benefit.

Plot Loan vs Home Loan

  • Land loans are available for only residential plots, much unlike home loans, that can be availed for all kinds of properties.

  • The maximum LTV (Loan To Value) ratio when it comes to home loans is set at 70 percent. In the case of loan for plot purchase, the LTV ratio can go up to 90 percent.

  • Non-Resident Indians (NRIs) cannot be offered plot loans by most of the banks that are operating on Indian grounds.

  • In comparison to home loans, the repayment tenure for land loans is relatively lower.

Things to Remember Before Going in for Land Loans

  • Land loans are available only against residential plots, located within municipal or corporation limits.

  • The rate of interest on land loans is much higher, as compared to home loans online.

  • No income tax benefits are available against land loans, unlike home loans.

  • Each lender has a different yardstick to measure an individual’s loan eligibility.

If you would like to learn more about loans for plot purchase or construction of properties, of, if you want to apply for you, you can do so through Bajaj MARKETS.

Land Loan FAQs

✔️Can a land loan be converted to a home loan?

Yes. A Loan for plot purchase can be indeed converted into a Home Loan. In order to do so, the borrower will have to submit a certain set of documents with their lender, which could differ on a case-to-case and lender-to-lender basis.

✔️Is it mandatory to have a co-applicant?

It is not mandatory to add a co-applicant to a commercial loan for plot purchase application form. However, it is recommended by several lenders to do so as it almost guarantees the full repayment of the sanctioned amount, thereby increasing the chances of a land loan approval.

✔️Are there any prepayment charges for Land Purchase Loan?

No, there are no such prepayment charges involved in land purchase loans.

✔️How can I get a land loan?

You can apply for a Plot Loan if you adhere to a bunch of simple steps. In the case of Bajaj MARKETS, all you will need are a bunch of basic details pertaining to either your identity and the plot of land that you are taking up the loan for.

✔️Are NRIs eligible for land loans?

If an NRI wants to invest in a plot that is vacant and has no immediate plans to construct a house on it, they can opt for a plot loan for the purpose of purchasing a plot of land in India.

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