The loan you take by keeping a self-owned property as collateral is called a Loan Against Property (LAP) or a secured loan. The value of the property determines the amount of loan that can be sanctioned. The property will be owned by the lenders if you are unable to pay the loan.

Lenders look at your repayment capability and asses your eligibility based on your income, age, employment stability, and other assets and liabilities. The loan doesn’t exceed more than 60% of the property’s market value. With a co-applicant, a higher amount can be borrowed.

You can use it for any purpose, like a personal loan. From renovating your home, starting a business, funding medical expenses, or even going on a long vacation, you can take a loan to fulfill all your needs.

You can avail loan on property using

Depending on your employment status, the bank or financing institution decides the loan against the property amount you’re eligible for. The maximum loan limit for self-employed people is INR 5 crore, and the same goes for salaried individuals too.

When it comes to home loan eligibility, banks or financing institutions make the decision based on the age of the property. If your property is aged 20 years or more, you may not get any loan against it.

Yes, you can get a loan against both residential and commercial land. You can keep either one as a mortgage or collateral to avail of a loan against property.

A primary applicant and a co-applicant can apply for a loan against property. However, they must meet these criteria:

Now that you know how beneficial a loan against property is for your business, you should understand its worth, especially during any emergency. This loan, for salaried or self-employed individuals, lets you keep your asset. You can keep residing in the property and utilize it for various other reasons, in addition, to producing it as security to help your company grow.