What Is Loan Against Property?

Loan against property (LAP), are basically loans provided by banks against the security of one’s own property. LAP is designed to meet the financial needs of someone who already owns a house or multiple properties so as to get the best out of their assets. Its important to remember that the property which you are putting up for your loan should be free any encumbrance (i.e. it is not given as security for any purpose or any other loan).

Banks provide LAP for both Salaried as well as Self-Employed individuals. The rates and loan amounts differ based on your property and your annual income.

Banks will always want to consider all risks, which is why while you are applying for your loan against property, there are certain factors the bank considers with respect to your property to mitigate its risks in giving out the loan. These factors determine your rate of interest, and loan amount. You can get a LAP of up to 80% of the registered value of your property depending on the Bank’s policy and the property type and valuation. The value of the property would be determined through a valuation conducted by the Loan Provider.

Individuals apply for LAP for a variety of reasons. Some of the common ones are your childs wedding, loans for new business ventures, second homes, vacations, medical treatment just to name a few.

LAP - Eligibility Criteria

Some of the Eligibility Criteria when applying for a Loan Against Property Are As Follows

  • Income
  • Age (min. 21 years)
  • Property Valuation
  • Existing Liabilities (if any)
  • Current Work Experience
  • Financial Documents
  • Number of Dependants

The eligibility for LAP is calculated on basis of either the percentage of property value that you own and the amount of income you have to enable you to return the EMI on the Loan. So you can get Loan against property upto annex % of property value and the net amount that you earn after other EMI has been deducted from your net income

Loan against Property is given on the below mentioned property types and the percentage of loan you can get is given below:

Loan Against Property – For a Residential Property

Self Occupied – 65% of Property Value
Vacant – 55% of Property Value
Rented – 55% of Property Value

Loan Against Property – For a Commercial Property

Self Occupied – 50% of Property Value
Vacant – 40% of Property Value
Rented – 40% of Property Value

This varies from Bank to Bank by 5 – 10% of the above mentioned percentages.

In order to calculate how much you would be estimated to pay, most banks use a formula which is given below.

Loan Against Property for Salaried Individuals:

{(NTH – Obligation) * 60%} / EMI per Lac
Loan Against Property for Self Employed Individuals:-

{(NTH – Obligation) * 65%} / EMI per Lac

Whichever is lower from the value of the property or your income- that loan amount will be given to you.

Other Eligibility Criteria Revolves around the maximum age of the Person Applying For The Loan

For Salaried employees – 60 Years
For Self-Employed – 70 Years

Loan EMI Calculator

Loan Amount is 30000
No. of Month is 30
Rate of Interest `{`ROI`}` is 10
Monthly EMI

Total Interest

Payable Amount

Interest Percentage

Loan Against Property Partners

GoSecure Financial has a large portfolio of partner banks and financial institutions:

Loan against property (LAP), are basically loans provided by banks against the security of one’s own property. LAP is designed to meet the financial needs of someone who already owns a house or multiple properties so as to get the best out of their assets. Its important to remember that the property which you are putting up for your loan should be free any encumbrance (i.e. it is not given as security for any purpose or any other loan). We had tied up with many financial institues and banks.

  • Axis Bank
  • Bajaj Finserv
  • Cholamandalam
  • Citibank
  • DCB Development Credit Bank
  • Deutsche Bank
  • DHFL
  • Edelweiss
  • Electonica Finance Ltd
  • First Blue
  • Fullerton
  • HDB Financial Services
  • HDFC Ltd
  • HSBC
  • ICICI Bank
  • Indiabulls Financial Services
  • IndusInd Bank
  • ING Vysya Bank
  • Investment Financial Services
  • Karvy Financial Services
  • Kotak Mahindra Bank
  • Magma Finance
  • Money Matters Finance Ltd.
  • Moneyline
  • Reliance Commercial Finance
  • Religare
  • Shriram City
  • Standard Chartered Bank (SCB)
  • Tata Capital

Documents Required for Loan Against Property

When you apply for the LAP, ensure to keep No Objection Certificate (NOC) and property papers ready. Loan Against Property can be availed by self employed, salaried, partnership firms & private limited companies.

To make your application process simpler, here is a list of documents that you will need:

Salaried

Identity Proof
  • PAN Card (mandatory) and any one of the below documents
  • Voter Card
  • Aadhar Card
  • Valid Passport
  • Driving License
  • Photo Identity card issued by Govt. body
Address Proof  – Any one of the below documents:
  • Any one of the below documents:
  • Voter Card
  • Aadhar Card
  • Valid Passport
  • Latest Utility bill
  • Rent agreement on stamp Paper
  • Bank Statements reflecting address of borrowers of any commercial nationalized bank
  • Life Insurance Policy
  • Residence address Certificate /letter by employer on company letterhead
  • Municipal or property tax receipt
  • Post office saving bank account statement
Proof of Income – (All the documents given below):
  • Last 2 months salary slip
  • Last 6 months bank statement of salaried account
  • Latest Form 16 / ITR
Other Documents
  • Documents related to running loans along with 6 months repayment bank statements
Property Documents
  • Copy of complete chain documents of the property (as applicable)
  • Copy of Approved Plan (if applicable)

Self Employed

Identity Proof
  • PAN Card (mandatory) and any one of the below documents
  • Voter Card
  • Aadhar Card
  • Valid Passport
  • Driving License
  • Photo Identity card issued by Govt. body
Address Proof  – Any one of the below documents:
  • Any one of the below documents:
  • Voter Card
  • Aadhar Card
  • Valid Passport
  • Latest Utility bill
  • Rent agreement on stamp Paper
  • Bank Statements reflecting address of borrowers of any commercial nationalized bank
  • Life Insurance Policy
  • Residence address Certificate /letter by employer on company letterhead
  • Municipal or property tax receipt
  • Post office saving bank account statement
Address Proof for Business Entities – Any one of the below documents:
  • Shops & Establishment Certificate
  • Trade License Certificate
  • SSI Registration Certificate
  • PAN Card/Sales Tax/ VAT Registration Certificate
  • Partnership Deed (for firms) / Memorandum of Association (MOA) for companies
  • Export-Import Code Certificate/Factory Registration Certificate
  • Professional qualification Certificate and Degree Certificate for Professionals
  • SEBI Registration Certificate
    Registration No issued by ROC
Proof of Income – (All the documents given below):
  • Income Tax Returns along with computation for last 2 financials years
  • Balance Sheet and Profit & Loss account along with all annexures (duly CA certified and audited if applicable)
  • Last six months current account statement of the business entity and saving account statement of individual
Other Documents – All the documents given below:
  • Documents related to running loans along with 6 months repayment bank statements
  • Latest List of share holding pattern (duly CA/CS certified)
  • MOA (for private Limited companies)
  • Partnership deed (for partnership firms)
Property Documents
  • Copy of complete chain documents of the property (as applicable)
  • Copy of Approved Plan (if applicable)

Frequently Ask Questions

  • Application
  • Processing
  • Documentation
  • Property Verification/Valuation
  • Sanctioning of the Loan
  • Disbursement

A nominal fees and charges are to be paid to the Bank depending upon their term and conditions.

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.

Some financial institutions make LAP available only under the floating rate. Fixed rate loans are off limits. Borrowers need to enquire before finalising a LAP from lending institutions.

It is normally available for residential properties only, but can be available for commercial property also.

Yes the property has to be insured against fire, flood, earthquakes and other appropriate hazards during the tenor of the loan.

The repayment of loan is done through Equated Monthly Instalments. It can be paid through Post Dated Cheques (PDC) or Electronic Clearance System (ECS).

The loan against property can be pre-paid along with the pre-payment charges. Usually the bank charges 2% of the principal pre-paid.

Apply for Loan Against Property

You can apply for a Loan Against Property online, All you need to do is provide your details below application form.