Loan against property is a loan that is given by Banks and NBFCs to any person that owns a property. The reason why you might have not heard a lot about this loan is that people only opt for this when they require a huge loan amount.
In India, the majority of Banks and NBFCs provide loans against property to any person that owns a property. This property can be anything from residential to commercial or industrial. It is also considered to be a secured loan that means there will be an asset that will be kept as collateral.
Because of this being a secured kind of loan, it is highly possible to get a lower loan against property interest rate. Yes, the interest rates are lower than most of other loan types because of the secured factor.
Is there a loan against property eligibility?
Yes, we must keep you aware of the criteria that have been set by Banks and NBFCs in India. These criteria must be fulfilled by a person if they wish to apply for a loan against property.
- Individual’s age – 18 years+
- Indian citizen
- Owner of a property (residential, commercial, industrial)
Things Banks check when you apply for a loan against property?
- Banks will check if you fulfill the basic criteria.
- Post that they will check your property papers and evaluate your property.
- This valuation will consider all factors right from year of purchase to current market rates and the real estate industry.
- Once that’s done, they will give you up to 45-70%* of your property’s value as the loan amount.
Please remember that loan against property is for people that wish to own a huge amount to clear expenses and emergencies like higher education abroad, medical emergencies, etc.
It will be wise for you as a loan applicant to maintain each document of your property. If documents are not fully complete, then your loan application will take a longer time to get approved. Hence if you wish to get the loan amount in a quick span of time, then maintain all documents.
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