Acquaint yourself with four essential aspects concerning Loan Against Property.

By utilising your property, you have the ability to generate funds, repay the loan along with accrued interest, and retrieve your property documents. This type of loan is secured, ensuring a swift and effortless disbursal process with minimal documentation requirements. 

Note: Prior to applying for a loan against property, it is crucial to bear in mind several essential factors. Firstly, ensure that your property possesses a lawful status, free from any disputes or legal complications. Secondly, verify that all necessary approvals and permissions have been obtained for the property. Lastly, confirm that you are the rightful owner of the property in question.

A loan against property (LAP) enables individuals to utilise their property as collateral to secure funds from banks and other financial institutions. By leveraging their property, borrowers can access funds, repay the loan with interest, and reclaim ownership of their property documents. This type of loan is considered secure, ensuring swift disbursal and requiring minimal documentation.

Applicants with a favourable credit score and a history of prompt repayments are likely to obtain this loan swiftly. In some cases, these loans are pre-approved for customers with impeccable financial records. With a flexible repayment period, extending up to 20 years or more, borrowers can easily manage repayment through equated monthly instalments (EMIs). Another advantage of this loan is the ability to retain ownership and uninterrupted enjoyment of the property, provided there is no default. The ownership status remains unchanged, and upon full repayment of the loan, the lender will return the property registration papers accompanied by a No Objection Certificate (NOC).

If you possess surplus funds, you have the option to consider pre-closing this loan. Moreover, if you opt for a loan with floating rates, there are no pre-closure charges to be paid. Secured loans offer competitive interest rates that are reasonably affordable. Additionally, a higher income and a favourable credit score can enable you to borrow larger amounts at lower interest rates.

Prior to applying for a loan against property, it is crucial to bear in mind certain essential considerations. Firstly, it is imperative that your property possesses legal validity, free from any disputes. Moreover, the property should have obtained all necessary approvals, and you must be the rightful owner. Keeping these significant factors in mind is highly advisable before proceeding with a loan against property.

The duration of the loan influences the interest rate. A longer duration results in higher interest rates. It is advisable to opt for a shorter repayment period whenever possible.

Your credit score holds significant importance in facilitating your ability to secure loans at lower interest rates. If you possess a credit score of 750 or higher, you can engage in negotiations with the bank to obtain favourable and appealing interest rates.

The interest rates and loan disbursement speed are influenced by the market value of your property. Acquiring a loan becomes more convenient if your property holds government approval.


In addition to the required documentation and the property itself, factors such as the borrower’s age, income, and employment status play a significant role in determining the interest rate and expediting the loan approval process.

Interest Rates & EMI on Loan Against Property

NOTE: The interest rates mentioned for Loan Against Residential Property (LAP) have been compiled from various listed (BSE) public and private banks, excluding small finance banks, as well as selective housing finance companies (HFCs). Only banks with available data on their websites have been considered. The data was collected as of January 3, 2022. The banks and HFCs are listed in ascending order based on their respective interest rates, with the bank offering the lowest rate positioned at the top and the highest rate at the bottom. The table displays the lowest interest rate offered by each bank and HFC for LAP, regardless of the loan amount and tenure. The Equated Monthly Installment (EMI) has been calculated based on the interest rate stated in the table for a loan amount of Rs 15 lakh and a tenure of 7 years. Please note that processing and other charges have been assumed to be zero for the purpose of EMI calculation. The interest rates provided in the table are indicative and may vary depending on the terms and conditions of each bank.



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