With a loan against property (LAP) or a land mortgage loan, you can put commercial or residential property that you own to good use and pledge it as collateral to receive the funding you need. This way, financing big-ticket purchases becomes easier and affordable too. This is because you can tap into a large reserve based on property value and secured loans come with lower interest rates. With no restrictions on the end usage of your loan, you are free to use the money at will. However, as your immovable asset is dear to you, you’re sure to have a few questions before pledging it. Here, are the answers to the most common questions you are likely to have about a loan against property in India.
What Is The Amount Of Loan I Can Get By Pledging Property As Collateral?
The loan amount you can avail will depend on the value of your property. This is calculated by taking your property’s location, size, age and other aspects into consideration. Most lenders offer you about 60% to 80% of the market’s value of your property as a loan. Reputed lenders like Bajaj Finserv offer you up to Rs.5 crore on a mortgage loan against property.
Who Can Apply For A Loan Against Property?
Salaried and self-employed individuals can apply for a loan against property. In fact, few lenders also sanction a property mortgage loan to NRIs provided they reside in a country on the lender’s approved list and are employed with a reputed organisation.
What Are The Loan Against Property Documents Required?
Here are the documents that you will need to submit if you are taking a mortgage loan against property:
- Application form
- Identity proof
- Address proof
- Bank statements from the most recent 6 months
- Cheque for the processing fee
While gathering the loan against property documents required, remember that any co-owner of the property will become an applicant in the loan too. Thus, you must first get their approval before deciding to pledge the property.
Additionally, if you are a salaried individual you will need to submit your latest salary slips and Form 16. Alternatively, if you are self-employed you will need to keep ready documents such as proof of educational qualifications and business presence. You will also need to have the balance sheets, tax returns, and P&L from the last 3 years.
Are They Any Tax Benefits On Repaying A Loan Against Property?
Whether you are taking a home loan for home loan against property, loan for land purchase or a loan for property purchase, you will not be able to claim tax deductions like you would on a home loan. However, if you have loaned the amount for the funding of a business need, you can claim tax deductions on the interest portion of your repayment.
Also Read: How can you Avail Tax benefits on your Loan Against Property?
Are you looking for an affordable, feature-packed loan against land, loan against plot, land mortgage loan or regular Loan Against Property? Look no further than reputed lender Bajaj Finserv. Here you can get funding up to Rs.5 crore at nominal interest rates. Further, you can avail the Flexi Loan facility to borrow as you need from your sanction and pay interest only on the used amount. What’s more, you can enjoy an easy balance transfer facility to avail these features even if you have already taken a loan against property. To get started, simply check your pre-approved offer and view customised deals to choose from for instant approval.
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