LAP Eligibility

The loan amount that you can borrow against your property is calculated based on four factors:

• Type of Property - Residential property and commercial property are the most eligible securities for loan against property. Banks do not give loans against agricultural land.
• Market value of property – the approximate worth of the property that you are giving as security subject to eligibility criteria. 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 depending upon your income.. Examples include income from salary, business, profession, interest, teaching, royalty, rent and fees. In some cases bonuses and sales incentives may also be added to income.
• 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.

LAP Process

Typically these loans are used to start or expand business or to renovate your house. But it can also be used to repay existing high rate loans.

Loan against Property refers to the secured loan category like home loan where the borrower gives a guarantee by using his property as a security. The right of ownership of the property is still with the borrower, and if he/she is unable to repay the loan amount, he/she can sell the property to pay off the debts.

For availing the Loan Against Policy, there are different stages:

1. Application
2. Processing
3. Documentation
4. Verification/Valuation
5. Sanctioning of the Loan
6. Disbursement

The processing of the loans usually takes 7 to 10 working days once all the documents are submitted. It also depends upon your profile and documentation.