With increasing real estate prices and booming property market people are waking upto the fact that they can now use their treasured abode as collateral for availing Loan Against Property. Many times people think of availing personal loans also for funding their business requirements, going on a dream vacation, daughter’s marriage, child educational requirements, buying a new car, medical expenses etc however LAP comes as a cheap and hassle free option looking to encash their home equity.
Loan Against Property(LAP)
Personal loans are expensive
LAP is 20-30% cheaper than Perspnal Loans
Longer tenors as compared to PLs
Lower rates due to the presence of collateral
Limit on amount sanctioned.
Depends on the value of property, generally it is given for 50-60% value of property.
Shorter repayment period
Longer repayment period
Features of LAP:
Offered against residential or commercial property.
Offered to persons engaged in business professionals, HNIs, Proprietorship/Private firms, NRIs etc.
Disbursed in the form of demand loan, term loan, overdraft etc.
Disbursed amount depends on the value of property and repayment capacity of the borrower.
Pricing of this facility usually ranges 4 to 5 % above bank’s base rate(Click here to know What is base rate)
Repayment is done in equated monthly installments by the borrower.
Documents required for availing LAP generally includes Identity proof, income proof, residence proof, bank statement or passbook etc.
We have tried our best to keep the latest information updated as available from RBI, users are requested to confirm information with the respective bank before using the information provided. The author reserves the right not to be responsible for the topicality, correctness, completeness or quality of the information provided. Liability claims regarding damage caused by the use of any information provided, including any kind of information which is incomplete or incorrect, will therefore be rejected.