Complete Guide to Property Loans in India
Complete Guide to Property Loans in India
Property loans in India, also known as Loan Against Property (LAP), are secured loans where individuals or businesses pledge their owned property as collateral to borrow funds from banks or financial institutions. These loans are popular due to their high loan amount, relatively low interest rates, and flexible usage.
What is a Property Loan
A Property Loan is a type of secured loan where you mortgage your residential, commercial, or industrial property to avail funds. Unlike home loans that are used specifically for purchasing a house, property loans can be used for a variety of personal or business needs such as education, expansion, or medical emergencies.
Types of Property Loans in India
Loan Against Residential Property – For individuals who own and mortgage a house or flat
Loan Against Commercial Property – For those who own shops, offices, or commercial buildings
Loan Against Industrial Property – For property used for manufacturing or industrial purposes
Lease Rental Discounting – Loan given based on rental income from a leased property
Overdraft Against Property – A flexible loan facility where interest is charged only on the amount used
Eligibility Criteria
Age between 21 to 65 years
Salaried, self-employed professionals or business owners
Stable and verifiable income
Clear ownership of property with legal documentation
Good credit score, preferably 700 and above
Documents Required
Identity and address proof such as Aadhaar, PAN, or passport
Income proof like salary slips, income tax returns, or business financials
Property documents including title deed and valuation report
Recent bank statements
Proof of business or employment
How to Apply for a Property Loan
Research and select the right lender based on interest rate and loan terms
Submit the loan application along with required documents
The lender conducts property valuation and verifies eligibility
Upon approval, the loan amount is s