All you wanted to know about loan against property in Delhi

All you wanted to know about loan against property in Delhi

A lot is going on in a person’s mind when he has to send his kids abroad for studies or maybe when he has to plan a wedding or needs funds to invest in his business. The first (and scary) thought is: “From where do I arrange all the money?” There are some creative ways to arrange these funds…like talking sweetly to your friends and relatives to convince them to lend you the money, but a better and self-sufficient way is to opt for a Loan Against (your) Property or Loan Against Property as it is popularly called.

So what exactly is a Loan Against Property in Delhi and do you make one fall into your LAP? Read our detailed guide below that explains everything about a loan against property. A loan against property is exactly what its name implies. It is a loan that is disbursed or provided against the mortgage of a property. It is obvious that if you want to take a loan against a property, then you have to be the owner of a property, preferably a self-occupied residential property. You may even get a loan against commercial property like a shop or factory but this is less likely as most banks, HFCs, and NBFCs prefer to provide LAP against residential properties only.

Loan Amount

So how much money can I raise against my property? Generally, lenders provide a loan of up to 60% of the property value as a loan. This percentage is called the loan to value or LTV. The maximum tenure offered is 10 years. The rate of interest will be higher than a home loan rate but lower than the interest rates on personal loans. The tenure of 10 years that is offered for a LAP is higher than the tenure offered for personal loans which are likely to be a maximum of 5 years. This coupled with a lower rate of interest results in a lower EMI for the customer and hence makes a LAP more attractive than a personal loan. The funds can, of course, be used for short-term requirements like a marriage, college fees, hospital expenses, expansion of business, taking a vacation, etc. Some lenders offer

up to 15 years tenure which makes it even more attractive in terms of more affordable EMIs