Loan Against Property

A Secured Loan Given Against Residential Or Commercial Property

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A loan against property is another name of the mortgage loan and is available for both salaried and self-employed borrowers to help them fulfill their business and personal needs by mortgaging their property.


Some of the basic purposes for which this loan is usually taken are expanding business, acquiring assets, education needs, marriage, etc. The loan is granted against the mortgage of the residential/commercial/industrial property. The end use of the loan should be from the uses allowed by the bank. The borrower is required to declare the end use of the loan in its application form.

Loan Against Property Key Features

  • Loan against fully constructed, freehold residential and commercial properties for Business Needs; Marriage, medical expenses, and other personal needs; transferring your outstanding loan availed from another Bank / Financial Institution.
  • Longer tenure, smaller EMIs.
  • Attractive interest rates.
  • Easy and hassle-free documentation.
  • Simple repayments through monthly installments.

Here is the checklist of the documents required to apply for a LAP:

  • Signed Application Form
  • Identity Proof (PAN)
  • Residential Address Proof
  • Form 16
  • Latest 6 months salary slip for salaried
  • Last 6 months bank statement
  • Last 2 years ITR


A Loan against Property is a secured loan availed against a commercial or residential property kept as collateral with the lender. As the funds come with no end usage restriction, borrowers can utilise the funds for various purposes such as business expansion, wedding, child’s education, etc.

A Loan against Property is a convenient option to finance all high-end expenditures for business or personal purposes. You can mortgage various Loan against Property types as collateral to avail funds of up to Rs. 3.5 Crore.

Following are some of the collateral variants lenders consider with their Mortgage Loan product types:

  • Self-occupied residential property, including house, apartment, flat, etc.
  • Rented residential properties are also accepted as Property Loan types.
  • Commercial property such as an office building, shops, malls, complexes, etc.
  • A plot of land under your ownership is accepted as one of the Home Mortgage Loan types.

A home loan is availed to buy or construct a new residential property. While loan against property can be availed for any reason. Under a home loan, the property you want to buy is transferred to the bank as collateral as and when they provide you with the loan. However, in the case of a loan against property, you submit your already owned property as collateral, and it can be either a residential property, commercial, land or industrial property. The lowest interest rate on a home loans is 8.10%. However, in the case of a loan against property, you submit your already owned property as collateral, and it can be either a residential property, commercial, or industrial property. The lowest rate on mortgage loan 7.20%.

Usually, lenders ask about the status of your existing loans when you apply for a Loan against property. This is done to assess the eligibility of paying out EMIs on your loan in the future. If your payment history is good, then the lenders may give you the option of taking top up loan on your existing Loan against property . The bank may also offer you a new LAP if it feels that your current income levels can support additional EMI repayments and hence, you can be eligible for a new LAP loan.