Loan Against Property without Income Proof or ITR

How to Avail a Loan Against Property without Income Proof

A Loan Against Property helps you get the funds you need to address big-ticket expenses, be it home improvement, overseas education, medical treatment or more. All you do is pledge your residential or commercial property to avail financing. 

However, lenders who offer a loan against property (LAP) often require certain documents to assess your eligibility, income and other parameters. Some lenders even offer a loan against property without income proof, and these instruments are often easier to avail. In fact, you can get a LAP without income proof or your income tax return with a little planning. 

Be it banks, non-banking financial companies or housing finance companies, every lender will require some proof of income regardless of your property documents being in order. This is why getting approval for an affordable loan against property without income proof can be difficult. 

While you may assume that having a property of your own makes you automatically eligible for a loan against property, lenders check your creditworthiness to ensure you have the ability to make the repayment on time. 

For any reason, if you are unable to provide income proof, be it with bank statements or the ITR, you can do so by using the tips below. Before you get started, ensure that you:

• Check your eligibility using the LAP eligibility calculator available on Bajaj Markets

• Have your other documents required for a loan against property ready to submit 

Documents Required for Applying for a LAP without Income Proof

Here is the paperwork you can keep at hand to apply for a (mortgage) loan against property without income proof:

• Correctly filled loan against property application form

• Proof of identity such as your Aadhaar, passport, voter ID, driving licence, and more

• Address proof such as your utility bill, ration card, passport or Aadhaar card

• Passport-size photographs

• Bank statements

Tips To Avail a Loan Against Property without Income Proof

• Discuss your plan with your existing lender: If you are an existing customer with a lender such as a bank or NBFC, contact your relationship manager. Usually, this individual has access to your financial profile and can help you understand if you can get a loan against property without any income proof or ITR. 

  If you have enough savings in your account or investments that can help assure the lender of repayment, talking to your relationship manager can get your approval on your application.  

• Get a co-applicant on board: One of the best ways to get a loan against property without ITR is to apply for a joint loan. You can do this with your spouse, parent or sibling but only if they have a good credit score and stable income. 

  This way, you can submit their ITR and income proof to assure lenders of timely repayment.  

• Clarify your sources of income: Most lenders approve a LAP application only after the property is checked by an evaluator or certified valuer. This helps them understand the property value and accordingly offer you financing. 

  During the valuer’s visit, you can explain your sources of income, be it through a business in the informal sector or other means such as rental income. The officer can then take into account your repayment capability on the basis of your conversation. This can help you get approval for a LAP without income proof.  

• Monitor and top up your savings account balance: Keep in mind that when you apply for a mortgage loan against property without income proof, lenders will review your banking habits closely. So, ensure there are sufficient funds in your account. 

  With healthy banking habits, you can boost the likelihood of your loan application being seen in a positive light even without these important documents.  

• Account for the lack of income documents: You can also try and explain why you do not have your income tax return or income proof to the relevant representatives of the lender. By giving a valid reason, your application for a LAP without income proof may be considered. 

  Do be proactive about talking to a tax consultant and file your returns for the current financial year if you are eligible to do so. This way, you showcase reliability and increase your chances of approval.  

• Consider accepting a decreased LTV: LTV stands for Loan to Value ratio, which is the loan amount against the value of the property you aim to mortgage. Usually, lenders offer 75% to 95% of the property value as a loan. 

  Since you are applying for a loan against property without any income proof, you can reduce your ask and choose a lower principal. This will help boost your eligibility as the lender’s risk is reduced.