A Brief on the Most Demanding Loan – Loan Against Property (LAP)
Loan against Property that is called LAP is a secured loan, which helps the borrower to meet his / her business financial needs by mortgaging his/her property. LAP can be effortlessly availed by both remunerated and self-employed individual.
For salaried people, the minimum work experience required is 3 years and for the self-employed business existence of the 5 years and ITR of 3 years is required. The age of the candidate should be between 21 years to 65 years.
LAP is given for tenancy of up to 15 years depending upon the suitability of pledger. A loan is given up to 60-70% of the market value of the assets. Go for the loan against property online anytime.
Below given are the loans against property details:
- Regular LAP: This type of loan is taken for business growth, obtaining assets, for a wedding or medical backup.
- LAP Overdraft: Borrowers who expect to have surplus income or inconsistent income during the year can opt for LAP overdraft. Under this facility, the borrower is charged interest rate only on the principal remaining and can deposit surplus money in loan account any time.
This option is highly suitable for self-employed capitalists or experts who have fluctuating funds requirements throughout the year.
- LAP Top Up: Top up loan is an additional loan amount that you can aim on your existing Loan against property. Investors apply LTV cap on Loan against the property to determine your top up loan amount suitability. This means that the amount of top-up loan plus your remaining mortgage loan outstanding should be less than or equal to 70% of the market price of the property.
Top up amount eligibility varies from one bank to another based on your income and value of the property and needs a thorough evaluation.
Eligibility for LAP
This mainly depends on the below factors:
- Type of property – LAP can be made available based on the type of property like Domestic Property, Commercial property, and Plots. Almost, every bank today provide loan on Housing property and commercial property but there are only some that would give loan against a plot.
- Consent – All Banks/NBFCs provide loan on properties permitted by the local authority for ex. JDA in case of Jaipur. Though society patta and gram panchayat properties can also be sponsored but interest rates on these properties are commonly somewhat higher.
- Valuation of the property – Loan up to 60% to 70% is commonly delivered against the properties and repayment capacity of the mortgagor. This is basically the monthly earnings of the debtor. For paid, this is reviewed by his gross/net income. For Self Employed people this is reviewed by the profits of the business.
- Credit Score from agencies
- Type of company individual works for
- Occupation and Age
- The locality of the individual like Metro/Non-Metro
- Any evasions or Credit Clearances
- Refund capacity post deducting any existing EMIs
Charges for LAP
Below charges are generally levied by the Banks/NBFCs while availing LAP
- Processing Fees – This generally varies from 2% to 5%
- Prepayment charges
Floating – If the interest rate is fluctuating, prepayment charges are zero for individuals.
Fixed – If the interest rate is fixed, prepayment responsibility is generally 2%.
- Property Insurance – This is the coverage of the belongings in case of any compensation due to events like Fire.
- Charges due to postponement in expenses.
Documents required for LAP
Generally, below docs are required for LAP
- Papers of the belongings to be mortgaged like a registry.
- KYC docs i.e. Pan Card and Aadhar card.
- Address proof like Aadhar card, Driving license, Passport, etc.
- Earning capacity
Salaried person– 3 month’s Salary slip and 6 month’s Salary Bank Account.
Self Employed – 3 years ITR and 12 month’s Bank statement
Loan against property can be applied after making comparison free of cost at dedicated online loan portals namely Antworks Money and more 24×7.
Rush to get out of your financial problems by taking advantage of the matchless loan against property online with acceptable terms and conditions.
