About Loan Against Property
Loan against property, as the name suggests, is applicable for individuals applying for a loan for purchase of a land/property, be it for commercial or residential interests. This comes off as a better option during times of financial crisis. Loan against property remains one of the most sought after loans in India, mainly due to the ever increasing real-estate prices.
A take-over of existing loan, with options of refinancing is also made available by most banks.
Characteristic of Loan Against Property
- A Secured Loan, it is offered only when the individual/applicant keeps the property with the bank as security. The loan interest rates are allocated based on the individual’s monthly salary, amount taken as loan, interest rates etc. Rate of interest of loans are again based on the customer’s profile (salary, credit history etc).
- Repayment periods are usually of the range of 10-15 years and hence are long-tenure loans.
- Minimum amount offered as loan is Rs 50,000/-
- The customer/applicant is also responsible for payment of charges towards administrative procedures while processing the application, along with the processing fee.
What purpose can one use loan against property funds for?
- Funding business and working capital needs of individuals, partnerships, private companies and SME's
- To purchase new property by pledging existing property
- As lower cost alternative to personal use and uses such as marriages, education, vacation, home renovation, medical emergency
Benefit of availing Loan Against Property (LAP) instead of other loans?
- As loan against property is secured against property, banks offer lower rate of interest compared to unsecured business loans or personal loans
- Loan tenure can be up to 18 years leading to lower EMI compared to unsecured loans where loan tenure can only be up to 5 years
- No additional collateral or guarantee is required
- Loan can be taken in name of company/ firm even if the property is owned in individual name of partners/ directors
How SCJK Finserv can help you for Loan Against Property?
As one of the leading loan & finance Compant in India, SCJK Finserv provides you with an unbiased platform to analyze and decide upon the available deals in the market.
Since banks follow strict procedures while lending loan for property, it is requested you be well versed with all the rules and regulations.With providing you details on status of your eligibility, amount you can borrow against the property as loan and terms & conditions
How is Loan Against Property Eligibility Calculated?
The loan amount that you can borrow against your property is calculated based on four factors:
- Market value of property – the approximate worth of the property that you are giving as security subject to eligibility criteria as described below. You may be eligible for a maximum of 75% of the value of the property.
- EMI that you can pay - the amount of money that you can pay every month towards loan repayment after meeting other expenses and paying your other EMI’s.
- Loan tenure - longer the loan tenure, higher the eligibility. Property loan tenure in India ranges from 5 years to 18 years.
- Interest rate - higher the rate of interest, lower the loan you will be eligible for.
Eligibility Criteria for Loan Against Property
The eligibility for Loan against property is determined by various factors including income, employment status, loan tenure and so on, and remains almost the same for professionals, self-employed professionals and businessmen.
- Any Indian citizen in good standing who is salaried, self-employed or business person with regular source of income can apply for a home loan.
- The applicant should be above the age of 18+ years.
- Should be currently employed with existing organization or been involved in your business for a specific number of years
- Professional stability and savings history play a major role in approval of the loan, especially minimum required monthly salary and repaying capacity
- Bad credit history would prove to be a put-off, especially anytime within 3 months prior to applying for home loan. Hence, should have submitted EMIs for other loans on time, for the said amount of period.
- Documents Required: 5 Photographs, Address Proof, I.D. Proof, 2 Stamp Paper of Rs.50/- in favor of the Applicant, Bank Statement of last 6 months, File Charge Rs. 4100/-
- Type of Guarantor : Government Guarantor, Private Limited Guarantor, Property Guarantor
- Documents Valid as Address Proof : Rashan Card,
Land Line Bill,
Mool Niwas Patra,
House Tax Slip,
Gas Bill etc.
- Required Documents of Guarantor : Last 2 months pay Slip,
5 Recent Photographs,
Bank Account Detail,
PROCCESING FEE Up to 3 lacks 10,000/-+1,800/-(18%) =11,800/- & above 3% of loan amount+18% (GST),
H.O.D & Salary In charge Signatures Along with his/her Stamp on Official Undertaking Bond Page No. X2. is a Compulsory.
3 Stamp Paper of Rs.100/- in favor of Guarantor. with Name, Address, Father Name & City with PIN Code (These must have a Signature & Thumb Impression and Public Notary)
One Photograph of each family member (Above 18 Years) (only in case of Private Limited guarantor)
In case of property guarantor, property documents are required like(Khasra, Khatauni, Registry)
- Documents Valid as I.D. Proof : PAN Card,
Job Certificate (at present) issued from company in which Applicant Working,
College Identity Card Etc,
- Note: Above mentioned Terms & Conditions may change from time to time as per firm/company policy without any prior information