In recent times, the popularity of Loan Against Property has made them a great way to get secured debt for personal and business purposes. A wide range of banks and NBFCs are offering ‘property secured loans’ to both salaried and self-employed people. The key advantages of Loans Against Property are low-interest rates, ease of getting a loan as compared to other non-secured debt products, and great flexibility in repayment and overall loan-related terms and conditions.
Considering the large market size of Loan Against Property, the offerings are also quite widespread. This has made the overall decision-making process for the customer very complicated.
Here is a comparative study of Loan Against Property from some of the top banks and NBFC in India.
ICICI bank is a large private bank and has offerings in almost every type of debt and deposit products. You can avail of ICICI Bank Loan Against Property for up to 70% of property value. This Loan Against Property offering is available to people falling in the age group of between 25 years to 65 years (or the age of retirement of the salaried borrower, whichever is earlier). The maximum duration for ICICI Loan Against Property cannot exceed 15 years in any case. The loan amount can range between Rs 10 lakhs to 5 crores. The bank also offers up to 90% of total LAP as an overdraft.
HDFC Bank is also among the top banks offering Loan Against Property to the customers. The HDFC Bank Loan Against Property is available for up to 65% of the property value. HDFC Bank extends Property Loans for both residential and commercial properties. The offer is open to both salaried and self-employed individuals. You can borrow it as an overdraft. One big advantage of HDFC bank is that they offer doorstep service for customers. The loan application documentation will include title deeds of the property, proofs of residence and identity for the borrower, etc. Salaried borrowers should submit the last six months’ salary slips, bank statements where salary is credited, and previous 2 years Form 16.
IDFC First Bank is an up and coming private sector bank. They offer deposit and debt products in many categories. The IDFC First Loan Against Property is available for Rs. 10 lakh to Rs 30 crore. The loans are available for salaried individuals, self-employed people, and even for companies. Individual borrowers must be between 18 to 79 years to take IDFC First LAP offers. For self-employed individuals, the turnover in the last two years must have been at least 5 Lakh and profit after taxes of 2 Lakh. For salaried borrowers, the income must at least be Rs. 14,000 per month.
SBI is the largest banking firm in India. They have one of the most attractive Loans Against Property in the country. The SBI Loan Against Property is available for durations ranging between 5 years and 15 years. These secured loans are available for any purpose as long as the bank does not regard it as a speculative purpose. The loan amount can range anywhere between a minimum of Rs. 10 lakh and a maximum of 7.5 crore. The processing charges on loan are 1% of the amount borrowed subject to a maximum of Rs. 50,000 plus applicable taxes. In select cases, you can also count rental income towards the calculation of eligibility for SBI Loan Against Property.
HSBC is one of the largest international banks active in India. The HSBC Bank Loan Against Property is available for up to Rs 10 crore. This secured loan can be taken out for as long as 15 years duration. The bank charges processing fees of 1% of the amount borrowed, subject to a minimum of Rs 10,000. The interest rate of the bank is 9.5% for both salaried and self-employed borrowers. As long as you are paying up to 25% of the borrowed amount as prepayment in a given year, there will be no extra charges levied. The bank will levy a 3% charge if you want to cross the 25% threshold of prepayment in a given year.
Bajaj Finserv is a leading NBFC which offers Loan Against Property to salaried individual borrowers for up to Rs 1 crore and to self-employed borrowers for up to Rs. 3.5 crores. The Bajaj Finserv Loan Against Property is offered for durations between 2 years and 20 years (18 years maximum for self-employed). The loan can be disbursed in just 4 days because of services like doorstep document collection, simple lending criteria, etc. The key advantage of Bajaj Finserv is its Flexi Dropline Feature, which allows borrowers to get disbursal on and as needed. They pay interest only on the amount utilised.
IIFL gives two options to borrow as Loan Against Property, Regular LAP, and Samman LAP. Samman LAP is a specially designed Loan Against Property scheme for small business owners. They can borrow loans up to Rs 35 lakh with a maximum tenure of up to 10 years. These loans are given for values of 70% for residential property pledged, and 60% of commercial property pledged. IIFL also offers Balance Transfer and Top Up Facility. The Regular LAP is for all other applicants, including salaried and self-employed individuals. This is also offered for a maximum duration of 10 years, but the loan can be sanctioned for amounts as high as Rs 10 crore.
Axis Bank is also a premier private sector bank with a wide array of financial and debt products. They have long duration Loan Against Property offerings, which can stretch up to 20 years. Loans will be sanctioned for amounts of Rs 5 lakh to Rs 5 crore. The interest rate on Axis Loan Against Property tends to float, based on market conditions. The bank offers loans for both residential and commercial properties. The loan processing charges will be of 1% subject to a minimum of Rs 10,000. All applicable taxes will be over and above this. An attractive balance transfer option is also available.
Taking a Loan Against Property is a very good way to start a new business or expand your current business. Always be careful that you borrow from RBI authorised lenders who have proven market records.
Also Read: Top 10 Lenders with Lowest Interest Rates on Loans Against Property
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