A Comprehensive Guide To Applying For A Loan Against Property

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A Comprehensive Guide To Applying For A Loan Against Property

  • Highlights

  • Get high-value loans without selling your property

  • You can pledge residential or commercial properties

  • Note the eligibility criteria and documents required

  • Check your pre-approved offer for swift financing

Thanks to the high-value loan amounts that a loan against property offers, you can use it to finance various needs. As of 2018, loans against property offered to MSMEs have increased significantly in the last four years. Apart from funding business requirements, the loan finds its application in a range of personal finance needs too. This alone establishes the popularity that a loan against property is gaining. Read on to know more.

What Is A Loan Against Property?

Your property becomes your collateral when you opt for a loan against property, meaning that the lender accepts it as security against which you are sanctioned the loan amount. This is also called a mortgage loan and you can either pledge a residential or commercial property. With the property being at the heart of a mortgage loan and home loan, some borrowers may not find a significant distinction between the two. However, in contrast to a home loan, a mortgage loan meaning and functions are different. Read on to understand this in detail.

What Is A Mortgage Loan?

In case of a mortgage loan, you are required to pledge an existing property to access funds to meet a variety of purposes like education, wedding expenses, car purchase, and more. You can pledge:

  • Residential property

  • Commercial property

  • Self-occupied property

  • Let out property

Depending on the property that you pledge, the lender offers you a loan of 60% to 80% of its market value. With a fair understanding of what is mortgage loan in India, now read how to apply for a loan against property so as to expedite your approval.

Home Loan EMI calculator

How To Take A Loan Against Property

Follow these simple steps to avail a loan against property:

  • The interest rate, loan-to-value ratio, and other features vary across lenders. Therefore, comparing loans offered by various lenders is important to bag the best deals. For instance, a Loan Against Property offered by Bajaj Finserv offers loan amounts of up to Rs.5 crore at affordable interest rates. Here the maximum tenor for a loan against property stretches up to 20 years for the salaried and up to 18 years for the self-employed. What’s more, you can make significant interest savings by opting for the Flexi Loan feature that lets you borrow as per your need and pay interest only on the used amount.

  • Before approving your loan, lenders require you to meet certain eligibility criteria that help them evaluate your creditworthiness and repayment capacity. These criteria vary across lenders. So, ensure that you meet them to qualify for the loan and hasten your loan approval. Following are the common criteria:

    • Your age

    • Income and savings

    • Credit history and score

    • Existing debts

    • The market value of the property

  • Next, note the documents required by your lender and gather them. Submitting the documents in a single go also hastens your approval. Following are the common documents required for a LAP sanction:

    • Income proof: Latest salary slips, bank account statements, ITR

    • Identity proof: PAN Card, Aadhaar Card

    • Address proof: Copy of the property documents

 

Additional Read: How To Apply For A Loan Against Property: A Step By Step Guide

Toe expedite your application process, check your pre-approved offer from Bajaj Finserv to view and benefit from your tailor-made deals. All you need to do is submit basic details like your name and contact number. Once you receive your offer, submit your application and enjoy instant approval.

DISCLAIMER:
The information, products, and services included in or available on bajajfinserv.in may include inaccuracies or typographical errors. Changes are periodically added to the information herein. bajajfinserv.in and/or its respective suppliers / affiliates may make improvements and/or changes on the bajajfinserv.in website at any time.
The material contained in this site and on associated web pages is general information and it is not intended to be advice on any particular matter. Subscribers and users should seek professional advice before acting on the basis of the information contained herein. The decision with respect to any financial product or opportunity or nature or suitability or choice or the viability of any product or service shall always be sole responsibility and decision of the subscriber and user.
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