Almost all banks or NBFCs offer loans against property (LAP) to loan seekers. LAP is a type of secured loan product which can be used by both salaried people and businessmen. One needs to mortgage their commercial or residential property to get an LAP. The entire process of loan against property application is quite easy and fast.
The following sections cover everything a person needs to know before applying for a loan against property.
How to apply for a loan against property?
Before applying for a loan against property, an applicant must conduct in-depth research, and check eligibility criteria and documents required. Most banks allow customers to apply for property loan via online and offline modes. Applicants can refer to the following steps to know how to apply for a LAP offline:
Step 1: One must go to the nearest branch of their preferred lenders.
Step 2: Representatives of the bank or NBFC will hand over an LAP application form.
Step 3: Applicants have to fill up this form with the necessary details.
Afterwards, the lender will reach out to the applicant via SMS, email or call to verify and confirm the details provided by them. Additionally, a representative of the bank or NBFC will provide assistance for the next steps of the loan against property process.
Other than this, an individual may apply for an LAP online. One has to visit the official website of a lender and provide a few details like phone number, property location, etc. Thereafter, one has to upload some scanned documents to proceed with the loan approval process.
What are loan against property eligibility criteria?
Below are the eligibility criteria that one must meet before applying for a loan against property (LAP):
- Applicants must be an Indian citizen residing in India.
- The most preferable CIBIL score for LAP approval is 700 or more than that.
- Borrower must be 25 years old (minimum age).
- The maximum age limit for applying for a LAP is 85 years old.
- Both salaried and self-employed individuals can apply.
Note: The above-stated criteria may vary from one lender to another
Many lenders provide pre-approved loans to eligible applicants. These include various financial products like loans against property, home loans, etc. An applicant can check their pre-approved eligibility criteria by providing a few personal details. This will hasten the overall LAP application process.
What are loan against property tax benefits?
Tax benefits under this type of loan depend on how the loaned amount is used by a borrower. One must note that interest paid is eligible for tax benefits and not for principal repayments. Here are some tax benefits one may get from a loan against property:
- Under Section 24: Under this section, one can avail tax benefits on the interest paid on an LAP if he/she uses the loaned amount to finance a new house.
- Under Section 37: Under this Sec of IT Act, one will get tax benefits on a loan against property.
What is the loan against the property balance transfer?
Loan against property balance transfer is a feature which involves transferring the outstanding balance of an LAP to a bank or NBFC. In this way, one will get competitive rates of interest. Besides, one will get the following additional attractive features and benefits of it:
- One can avail a sizeable top-up loan on their existing LAP.
- Various lenders offer doorstep document pick-up services to avoid any logistical delays.
- One can use a wide variety of online calculators to enhance their LAP balance transfer application.
- The entire process of application and approval is fast and hassle-free.
How to use a loan against a property EMI calculator?
To ease the whole process of LAP application process, nearly all reputed banks and NBFCs offer online property loan EMI calculator to check the EMI with a few clicks. Additionally, one can allow an individual to adjust the tenure and loan amount to get the EMI value. This will help one to plan the repayment in advance. Here are the steps on how to use a LAP EMI calculator:
Step 1: An individual has to type ‘loan against property EMI calculator’ on the search bar.
Step 2: One has to set the loan amount and tenure by sliding the bar in any of the online calculators.
Step 3: The applicant has to use the slider to set the rate of interest (ROI).
The calculator will show the EMI, interest amount, and principal amount on the screen within a second.
The entire process of loan against property is very easy and fast but a few mistakes can mess the process. One must properly calculate the property value and compare the interest rates before applying for a loan against the property.
