✓ Loan Against Property from ₹15 Lakhs to ₹5 Cr ✓ Multiple Lending Partners ✓ Attractive Interest Rates

If you want to avail credit for your various financial requirements, you can choose the LIC Housing Finance Limited’s loan against property. You can mortgage either commercial or residential property to avail of this loan. The key highlight of this loan is its competitive and reasonable LIC LAP interest rate. Remember, a wide range of factors, such as the amount of your loan, your CIBIL score, age of the property, and more, impact the LIC’s loan against property interest rates. Also, the interest rate can vary, depending upon the type of property that has been pledged. Here’s a look at the LIC’s loan against property interest rates.

Type of property

Rate of interest for salaried individuals

Rate of interest for self-employed individuals

Residential

Starting from 8.35%

Starting from 8.35%

Commercial 

Starting from 9.60%

Starting from 9.60%

LIC HFL LAP Features

Now that you are aware of the current LIC Housing Finance LAP interest rate, here’s a look at the key features of this property loan: 

  1. Long repayment tenures: The Loan Against Property (LAP) from LIC Housing Finance Limited (HFL) provides you with the option to choose a flexible repayment tenure. To decrease your EMI obligations, you can select a long repayment tenure of up to 30 years.

  2. Customised offerings: As an existing customer of LIC HFL, you can also receive customised offerings or pre-approved offers for a new loan against property. 

  3. No restriction on the usage of the loan amount: A loan against property from LIC HFL can be used for your specific fund requirements. Be it the cost of higher education, expenses in a wedding, foreign tour, business expansion, and more, you have the complete freedom to use the loan amount. 

  4. High property valuation: Based on the value of your property, a lender will specify the maximum loan amount. This is known as Loan to Value (LTV). It is expressed in percentage as the specified value for your property. LIC HFL provides an attractive 70% LTV for residential properties and a competitive 65% LTV for commercial properties. For instance, if the market value of your residential property is Rs. 20 Lakhs, then LIC HFL will provide a maximum loan amount of Rs. 14 Lakhs, which is 70% of the property value. Similarly, for a commercial property worth Rs. 20 Lakhs, the LTV rate of 65%, will provide a maximum loan amount of Rs. 13 Lakhs.

  5. Hassle-free documentation: With the loan against property from LIC HFL, you are required merely to provide the basic documentation for your income, address, identity, and occupation. 

  6. Affordable LIC loan against property rate of interest: The LIC LAP rate of interest is among the most inexpensive and reasonable rates in the market. 

  7. Quick disbursal: Once your property loan application is approved, you can expect the loan amount to reflect in your account shortly. 

LIC HFL Loan Against Property Processing Fees & Other Charges

Did you know that you have to pay other charges along with the LIC HFL interest rate as well? Yes, you have to pay the processing fees, late payment fees, and more. To have a clear understanding of the various fees and charges, you can refer to the table given below:

Fees and charges

Processing fees

1% of the loan amount, along with applicable taxes. 

Prepayment charges

The LAP can be prepaid only after 12 months. There are no prepayment charges for a loan against property availed at floating rates of interest.  

Foreclosure charges

There are no foreclosure charges for a loan against property availed at floating rates of interest.  

How is the LIC HFL Interest Rate Calculated?

LIC’s  loan against property interest rates are calculated after considering a variety of factors, including the loan amount, CIBIL score and type of the property. Here’s a detailed look at the important variables determining your interest rate:

  1. Loan amount: The LIC LAP interest rate primarily depends upon the loan amount. With a high loan amount, you can expect a higher interest rate.

  2. CIBIL score: With an optimum CIBIL score of 700 and above, you can get a property loan at reasonable rates of interest. But with a poor CIBIL score, you will get a loan at a comparatively higher interest rate. 

  3. Type of property: If you have pledged a residential property, you can expect a comparatively lower rate of interest. Conversely, commercial properties that have been pledged as collateral carry a slightly higher rate of interest.

  4. Age of the property: The LIC housing finance LAP interest rate is also calculated after considering the age of your property. A property that has been recently constructed can provide lower rates of interest, while an old property can provide a higher interest rate. Here, you should remember that according to the stipulation of LIC HFL, the pledged property should not be more than 35 years old.

  5. Internal policies of the company: The internal policies of the lending company play an important role in the calculation of interest rates. For instance, LIC HFL uses the Prime Lending Rate (PLR) as its internal benchmark to determine the interest rate on property loans.

LIC HFL Loan Against Property Documents Required

While submitting the loan applications, borrowers have to submit various documents. Here’s a look at the documents required for a LIC HFL loan against property, both by salaried and self-employed individuals: 

 

Documents to be submitted by salaried individuals 

Type of proof

Accepted documents

Residence proof

  • Aadhar card

  • Ration card

  • Voter ID 

  • Electricity bill

  • Telephone bill

Identity Proof

  • Driving License

  • Aadhar card

  • Passport

  • Voter ID

Income proof

  • Form 16 

  • Bank statements

  • Salary slips

Ownership of property

Title documents of the property

 

Documents to be submitted by self-employed individuals 

Type of proof

Accepted documents

Residence proof 

  • Aadhar card

  • Ration card

  • Voter ID 

  • Electricity bill

  • Telephone bill

  • Registered rent agreement

Identity Proof 

  • Driving License

  • Aadhar card

  • Passport

  • Voter ID

Income proof


  • Bank statements

  • ITR

  • Audited financial statements, including balance sheet and profit and loss account

Proof of business

  • Partnership deed

  • Memorandum of Association and Articles of Association

  • Certified copies of the list of directors/shareholding partnership/profit sharing ratio

  • LLP agreement

Ownership of property

  • Title documents of the property 

  • Business address proof

Frequently Asked Questions

  • ✔️What is the percentage of property value can be availed as loan?

    LIC HFL provides a maximum loan of up to 65% of the property’s value for commercial properties. In the case of residential properties, the percentage is fixed as 70%.

  • ✔️What is the process of loan against property?

    The process of availing a loan against property involves pledging your commercial or residential property as collateral to avail the property loan. These secured loans have a comparatively lower interest rate vis-a-vis other types of loans, such as personal or business loans.

  • ✔️What is the benchmark rate applicable for a mortgage loan?

    LIC HFL uses the Prime Lending Rate (PLR) as its internal benchmark rate to determine the interest rate on a mortgage loan. At present, the LIC HFL’s PLR is 14.60%

  • ✔️Do I get tax benefits on a loan against property from LIC HFL?

    Yes, you can claim tax benefits for the interest payments on a loan against property from LIC HFL.

  • ✔️How to increase my eligibility on an LIC HFL mortgage loan?

    You can increase your loan eligibility by adding a working spouse or relative as a co-applicant.