Avail Loan Against Property Interest Rates ranging from 8.75% to 10.00% for up to 15 crore. Check your loan against property eligibility online and get approval for up to 70% of residential or commercial property for up to 15 years at the lowest LAP interest rate. You can apply for best LAP offers for personal or business needs, without any obligation.
Bank Name | Interest Rate | Processing Fees |
---|---|---|
PNB HFL | 9.25% - 12.50% | 0.75% of loan amount (Maximum Rs. 1,00,000) + GST |
Bank of India | 10.75% - 11.50% | Up to 1% of loan amount (Maximum Rs. 50,000) |
Bank of Baroda | 10.20% - 15.85% | Up to 1% of loan amount (Minimum Rs. 8,500) |
Indian Overseas Bank | 9.75% - 10.25% | Up to 0.75% of loan amount |
State Bank of India | 10.00% - 10.70% | Up to 1% of loan amount (Maximum Rs. 50,000) + service tax |
IDBI Bank | 9.85% - 11.10% | 0.50% to 1% of loan amount (Minimum Rs. 10,000) |
Central Bank of India | 13.75% - 15.00% | Up to 1% of loan amount |
HDFC Bank | 9.50% - 10.50% | Up to 1% of loan amount (Minimum Rs. 7,500) + taxes |
UCO Bank | 10.35% - 12.35% | Up to 0.50% of loan amount |
Bank of Maharashtra | 10.35% - 10.85% | 1% of loan amount + GST |
Jammu & Kashmir Bank | 9.20% | Up to 1% of loan amount + GST |
Citibank | 8.75% | Up to 0.75% of loan amount |
Federal Bank | 9.75% | 1% of loan amount (Minimum Rs. 3,000) |
Kotak Mahindra Bank | 9.15% | 1% of loan amount + GST & statutory dues |
Karnataka Bank | 11.93% - 13.13% | 1% of loan amount (Minimum Rs. 7,500) + existing upfront fees |
Karur Vysya Bank | 10.50% - 11.40% | 0.50% of loan amount |
South Indian Bank | 12.55% - 13.80% | 0.50% of loan amount |
Tamilnad Mercantile Bank | 11.30% | 0.50% to 1% of loan amount + applicable taxes |
IDFC First | 8.75% - 20.00% | Up to 0.50% of loan amount |
Dhanlaxmi Bank | 10.60% - 13.95% | 1.50 % of loan amount (Minimum Rs. 10,000) + service tax |
YES Bank | 8.95% - 12.00% | Up to 2% of loan amount (Minimum Rs. 10,000) + GST |
A Loan Against Property is a "No Questions Asked" personal loan with security. It is similar to a personal loan in many respects but has its distinct flavour.
The key features of a Loan Against Property are as follows:
If we classify the bank loan interest rates into three categories like 'Low, Medium, and High,' the interest rate for the Loan Against Property will fall in the Medium category. There are specific reasons why it classifies under this category. We shall discuss the logic, but in the meanwhile, this interest rate comparison should help you understand the classification.
Banks/Loan Product/Interest Rate Range | Housing Loan Interest Rate Range | Loan Against Property Interest Rate Range | Personal Loan Interest Rate Range |
---|---|---|---|
SBI | Starts from 8.40% | Starts from 10.00% | Starts from 10.65% |
ICICI Bank | Starts from 8.40% | Starts from 9.75% | Starts from 10.75% |
HDFC Bank | Starts from 8.40% | Starts from 9.50% | Starts from 10.50% |
Axis Bank | Starts from 8.60% | Starts from 9.90% | Starts from 10.25% |
Bank of Baroda | Starts from 8.25% | Starts from 10.20% | Starts from 10.25% |
Inference
Below are the rates of interest on loan against the property of some of the top banks in India:
State Bank of India refers to the MCLR structure while defining the interest rate on loans against property.
The MCLR-1Y for State Bank of India with effect from November 10, 2022, is 10.00%. The interest rate on the Loan Against Property depends on this rate.
When more than 50% of the Net Monthly Income is from salary | ||
Loan Amount Slab | Rate of Interest | Effective Rate of Interest |
> = 800 | EBR + 1.75% | 10.00% |
750 - 799 | EBR + 1.85% | 10.10% |
700 -749 | EBR + 1.95% | 10.20% |
650 - 699 | EBR + 2.05% | 10.60% |
550 - 649 | EBR + 2.15% | 10.70% |
NO CIBIL | EBR + 1.95% | 10.50% |
ICICI Bank refers to the RBI Repo Rate for determining the interest rate on loans against property.
For Salaried
Slab | Rate of Interest (p.a.) |
Loan Against Property | 9.75%-10.40% |
Non-Residential Premises | 9.75%-10.40% |
Lease Rental Discounting | 9.75%-10.40% |
For Self-Employed
Slab | Rate of Interest (p.a.) |
Loan Against Property | 9.75%-10.40% |
Non-Residential Premises | 9.75%-10.40% |
Lease Rental Discounting | 9.75%-10.40% |
HDFC Bank has its Retail Prime Lending Rate (RPLR) for non-housing purposes. The RPLR (Non-Housing) is 9.50% as on date.
HDFC Bank offers floating and fixed rates of interest. The floating rate is the Adjustable Rate Loan, whereas the fixed-rate is the TruFixed loan, where the rate of interest remains fixed for two years. Subsequently, it converts to a floating rate.
Loan Slab | Interest Rates (p.a.) |
---|---|
Self-occupied Residential Property | 9.50%-10.70% |
Non-self-occupied Residential Property | 10.00%-11.15% |
Commercial Property | 10.00%-11.90% |
Axis Bank refers to the RBI repo rate when determining the rate of interest on loans against property.
Axis Bank offers term loans and overdraft facility on loans against property. The rates of interest are different for each facility.
Type of Loan | Repo Rate + Spread | The effective rate of interest |
Floating Rate- PSL Category | RR + 4.00% to RR + 4.40% | 9.90% to 10.30% |
Floating Rate- Non PSL Category | RR + 7.10% to RR + 7.20% | 9.90% to 10.30% |
Bank of Baroda refers to the RBI repo rate as its base for deciding the BRLLR. The Loan Against Property depends on the BRLLR.
The Repo Rate as on date is 5.90%. Bank of Baroda adds a Mark-up rate of 3% to arrive at the BRLLR. There is a concept of an SP rate of 0.25%, as well.
For Individual borrowers - depends on CIBIL score | ||
Amount Slab | Tenure up to 120 months | Above 120 and up to 180 months |
Up to 7.5 Crores | BRLLR + SP + (1.45% to 6.35%) = 10.20% to 15.10% | BRLLR + SP + (1.95% to 6.85%) = 10.70% to 15.60% |
More than 7.5 Crores | BRLLR + SP + (1.70% to 6.60%) = 10.45% to 15.30% | BRLLR + SP + (3.20% to 5.75%) = 10.95% to 15.85% |
For Non-individual borrowers | ||||
Tenure up to 120 months | Above 120 and up to 180 months | |||
Margin | Up to 7.5 Crores | Above 7.5 Crores | Up to 7.5 Crores | Above 7.5 Crores |
Above 50% | BRLLR + SP + 1.70% = 10.45% | BRLLR + SP + 1.95% = 10.70% | BRLLR + SP + 2.20% = 10.95% | BRLLR + SP + 2.45% = 11.20% |
Up to 50% | BRLLR + SP + 2.20% = 10.95% | BRLLR + SP + 2.45% = 11.20% | BRLLR + SP + 2.70% = 11.45% | BRLLR + SP + 2.95% = 11.70% |
In all the five cases that we have discussed above, the Home Loan Rates of Interest are more than 1% point lower than the rates for Loan Against Property.
Banks/Loan Product/Interest Rate Range | Housing Loan Interest Rate Range | Loan Against Property Interest Rate Range |
---|---|---|
SBI | Starts from 8.40% | Starts from 10.00% |
ICICI Bank | Starts from 8.40% | Starts from 9.75% |
HDFC Bank | Starts from 8.40% | Starts from 9.50% |
Axis Bank | Starts from 8.60% | Starts from 9.90% |
Bank of Baroda | Starts from 8.25% | Starts from 10.20% |
Banks/Loan Product/Interest Rate Range | Loan Against Property Interest Rate Range | Personal Loan Interest Rate Range |
---|---|---|
SBI | Starts from 10.00% | Starts from 10.65% |
ICICI Bank | Starts from 9.75% | Starts from 10.75% |
HDFC Bank | Starts from 9.50% | Starts from 10.50% |
Axis Bank | Starts from 9.90% | Starts from 10.25% |
Bank of Baroda | Starts from 10.20% | Starts from 10.25% |
If you look at the interest rate structure of the banks, you find that the individual interest rate falls in a range. It implies that the rate of interest is not the same for all borrowers.
Here are the factors that determine the interest rate for individual borrowers:
Up to Rs. 5 Crore loan against property can be availed by Salaried and self-employed applicants online as well as offline. The LAP can be used for applied for business expansion, long term working capital, debt consolidation, equipment purchase, medical exigency, education/ marriage of children, holiday and much more. Higher loan amounts are available for select customers.
State Bank of India offers the best interest rate on Loan Against Property as on date.
Both individuals and non-individuals can apply for Loan Against Property. Individuals can be salaried persons or self-employed people. The applicant should have unencumbered residential or commercial property in his/her name.
Non-individuals comprise the following entities:
Some banks also offer Loan Against Property to educational institutions against the mortgage of the school building. Central Bank of India has a specific loan product, Cent Mortgage for Educational Institutions.
The different types of Loan Against Property are as follows:
No, banks do not accept agricultural mortgage as a security for Loan Against Property.
The security is in the form of equitable mortgage of property. In the case of loan against rent receivables, the banks stipulate additional protection in the form of assignment of future rent receivables.
Yes, the CIBIL score has a significant bearing on deciding the rate of interest. Usually, banks stipulate a minimum CIBIL score of 650 or thereabouts. The higher your CIBIL score, the lower is the rate of interest.
Usually, banks do not offer Loan Against Property on a fixed-rate basis. However, HDFC has a loan product that provides a combination rate of interest. The TruFixed Loan product has a fixed rate of interest for the first two years, followed by a switchover to the floating rate.
It depends on individual banks. Some banks levy a prepayment penalty on the foreclosure of Loan Against Property, whereas some do not. However, non-individual borrowers and those borrowers in the fixed-rate structure are liable to pay a prepayment penalty.
Some banks offer Loan Against Property as an overdraft facility. Under such circumstances, the drawing power reduces annually by a specific pre-determined amount. It is known as the Dropline Overdraft Method. The objective is to close the Loan Against Property at the end of its tenure.