A loan against property (LAP) is a secured loan that allows borrowers to leverage their property to secure funds. This type of loan can be used for various purposes, including personal needs, business expansion, or other financial requirements. This guide discusses the eligibility criteria, necessary documents, types of loans against property, interest rates, repayment options, and frequently asked questions.
Eligibility criteria for LAP generally include:
Essential documents include:
Loans against property can be classified as follows:
Interest rates for loans against property usually range from 9% to 14%, depending on the lender and the borrower’s profile.
Repayment terms are generally between 5 to 15 years, with flexibility for part payments in many cases.
The loan against property application process typically includes:
A loan against property is a secured loan where the borrower pledges their property as collateral to secure the loan.
The amount you can borrow depends on the value of your property and the lenders policies, typically up to 70-80% of the propertys value.
If the borrower defaults on the loan, the lender may repossess the property used as collateral.
It can be beneficial if you need funds for significant expenses, but it carries risks. Always assess your financial situation.