A Loan Against Property is a kind of secured loan that you can avail against a commercial or residential property. This property is kept as collateral with the lender, and the funds so obtained can be utilised for a variety of purposes such as business expansion, funding your wedding, child’s education etc.
You can avail a Loan Against Property by mortgaging a residential, commercial or industrial property. All you need to do is furnish the relevant documentation with the lender which includes KYC documents, proof of income/salary etc.
The documents required for a Loan Against Property for salaried employee are are:
Latest salary slip
Last 3 months bank account statements
PAN card/Aadhar Card
Address proof such as telephone bill, electricity bill, gas bill, passport, Aadhar card, driving license, voter ID, lease rental agreement, home ownership papers
Property documents for mortgaged property
Income Tax returns for the past 3 years
Bank account statements for the last 6 months
PAN/Aadhar Card
Address proof documents like passport, electricity bill, gas bill, telephone bill, property ownership papers, Aadhar card, driving license, voter ID
Property documents which is to be mortgaged
Age of the applicant to be between 33 years to 60 years
Must be employed in an MNC, private or public sector company
Place of residence must be Delhi, Gurugram, Faridabad, Greater Noida, Noida, Ghaziabad, Mumbai, Thane, Navi Mumbai, Bangalore, Pune, Hyderabad, Chennai, Ahmedabad, Kolkata, Jaipur, Chandigarh, Coimbatore, Nagpur, Surat, Cochin, Baroda, Indore, Vizag, Nasik, Aurangabad, and Lucknow.
Age of the applicant must be between 25 years to 75 years
The business must have a regular source of income
Place of residence must be Delhi, Gurugram, Faridabad, Greater Noida, Noida, Ghaziabad, Mumbai, Thane, Navi Mumbai, Bangalore, Pune, Hyderabad, Chennai, Ahmedabad, Kolkata, Jaipur, Chandigarh, Coimbatore, Nagpur, Surat, Cochin, Baroda, Indore, Vizag, Nasik, Aurangabad, and Lucknow.
Different lenders have varying maximum limits for Loan Against Property; Finserv MARKETS can provide access to a higher amount of Loan Against Property of up to Rs 1 crore at affordable interest rates, flexible repayment options and quick loan disbursal.
Yes, Loan Against Property is a loan you can avail against either your self-occupied or rented residential properties.
Yes, you just need to ensure that the title of the property is clear, free of any litigation, and should not have an existing mortgage or loan.
If you follow the proper steps - furnish documentation and personal details, verification - then the disbursement can happen as soon as 24 hours at Finserv MARKETS.
You can use the following properties as collaterals for your Mortgage Loan:
Self-occupied residential property, including house, apartment, flat, etc.
Rented residential/commercial properties
Commercial property such as offices, shops, malls, complexes, etc.
Shared property
A plot of land under your ownership
You cannot, however, avail a Loan Against Property against the following:
Property outside city/municipality limit
Property with tenants for more than 5 years (with no renewed rent agreement)
Property with structural flaws that require substantial repairs
Property constructed on agricultural land/farmland
Illegal properties or a property already mortgaged with other banks
Residential property used for commercial purposes without approval from a competent authority
Under construction property except for NRP transaction
Industrial property
Schools or hostels
Hotel
There are several differences between Home Loan and Loan Against Property, the most fundamental of them is the purpose they serve. A Home Loan is borrowed to buy a house, a plot or for construction, whereas a Loan Against Property is a secured loan that lets you borrow money for any major expense under the sun including renovation, personal expenses, business expansion etc, with your property as the collateral. With Home Loans, repayment tenures are longer and tax exemptions are present. You can peruse the other differences between these two in detail here
Since your home is put up as collateral, taking equity out of your house can be an easy way of qualifying to access large amounts of money.
Income is a key determinant in assessing your eligibility for a Loan Against Property, therefore, it is essential to furnish IT Returns and/or latest salary slips, but without such proof, you may need to fulfil certain documentation and eligibility parameters.
You can try to apply with a co-applicant, have a proper justification and a personal conversation with the relationship manager, convincing them of timely repayments without defaulting. Also make sure you hold a bank balance, which is double the expected loan EMIs.
A Loan Against Property is a convenient way of accessing funds for personal or business expenditures of sizeable magnitude. If you meet the eligibility criteria, you just need to furnish some documents reflecting your income and the property ownership. After this, your credit score is computed and a loan sanction is made. Upon your acceptance and after the verification of all documents, the loan is disbursed. You can repay this loan in accordance with amortization schedule.
For a Loan Against Property, the taxability depends on the purpose of the loan. If used for personal purposes like marriage or education of your child, tax benefits cannot be claimed on the interest. If the money is used for funding another house property, then, the same can be claimed under Section 24(b) of the Income Tax Act.