Introductory statements
A loan against property or LAP is a loan amount that is authorised against the collateral/property. It is a secured form of credit when one offers existing residentia, industrial or commercial property as security. LAP is generally financed by banks and other financial institutions including some big finance corporations.
In today’s module, we’ll figure out which bank offers the best Loan against property (LAP) and what extra difference those banks have if compared with other banks in the market. Although every bank offers LAP few recognised banks are considered best and always a first preference of LAP seekers. LAP interest rate starts from 8% and goes up to 25%, one can avail loan of upto INR 25 crore with a tenure of upto 20 years.
HDFC Bank
HDFC Bank provides a loan of 65% on the property value to fund your planned needs. HDFC Bank understands the importance of financial goals and offers LAP at an attractive rate of interest.
Read Article: HDFC bank Interest rate
HDFC bank (Loan against property): Features
- Higher sanctioned amounts.
- Both residential and commercial properties are accepted and can be used to fulfill personal/professional needs.
- Easy repayment of loan EMIs at a competitive rate of interest.
- No Hidden charges or extra fees.
- Customized loan options and personalized schemes.
- HDFC Loan against property is easy Debt- consolidation tool.
HDFC Bank: Charges applicable and Documents required
Interest rate
Documents required
Self-employed professionals / Individuals
CA-certified financial statements
Residence proof - Telephone bill, Electricity bill, Ration card, Voter ID card
Identity proof - Aadhar card, PAN card
Latest statement of the bank showing income/salary credited for the last 6 months.
Certified copy of property documents pledged against the loan.
Salaried Individuals
Residence proof - Telephone bill, Electricity bill, Ration card, Voter ID card
Identity proof - Aadhar card, PAN card
Latest statement of the bank showing income/salary credited for the last 6 months.
Certified copy of property documents pledged against the loan.
Previous 6 months' salary slip after all deductions
Form 16 of last 2 years
Standard Chartered Bank
Standard Chartered Bank offers Loans against property on 75% of property value for residential and 60% on commercial properties. Get easy funding upto INR 25 crore with a flexible repayment tenure of 20 years.
Standard Chartered Bank (Loan against property): Features
- High loan value and Easy repayment tenure.
- Simplified calculation of interest.
- Using LAP saver funding upto 80% and a maximum of 90% as term loan and working limits.
- Easy documentation and clarified process
- Residential and commercial property both can be used.
Standard Chartered Bank: Charges applicable and Documents required
Interest rate
Starting from 9%
Processing fee
Upto 1% of the sanctioned amount.
Documents required
Documents related to the business establishment.
Identity and Address proof.
Previous 6-month bank statement
Latest 2-year Income Tax return including Profit & Loss statement, Balance sheet
Check: Loan Against property Emi Calculator
Kotak Mahindra Bank
Kotak Mahindra Bank provides Loans against property to fulfil your personal and business needs at an attractive interest rate starting from 9.15% along with a flexible repayment option and can get secured against residential, commercial and industrial property.
Kotak Mahindra Bank (Loan against property): Features
- The sanctioned amount ranges from INR 10 lakhs to INR 5 crores.
- Flexible offerings - EMI-based or Overdraft facility
- The amount can be availed against any kind of property like residential, commercial and industrial.
- Lower rate of interest
Kotak Mahindra Bank: Charges applicable and Documents required
Interest rate Starting from 9.15%
Processing fee 1% plus GST and statutory dues (Non-refundable)
Documents required
Application Form
PAN card
Identity proof
Address proof
Ownership proof
Business continuity proof / Relationship proof (For salaried).
MOA/AOA/Partnership Deed/GST registration certificates.
Last 3 months audited financials (For Business) / 3 Months salary slip / Form 16 / Employment proof (For salaried).
Last 1-year bank statement (Business A/C) / 6 - months bank statement reflecting salary (For salaried)
Axis Bank
Axis Bank provides Loans against property to fulfil your personal and business needs at an attractive interest rate starting from 11% along with a flexible repayment option and can get secured against residential, commercial and industrial property. Read Article: Axis bank interest rate.
Axis Bank (Loan against property): Features
- Loan amounts start from a minimum of INR 5 lakhs to a maximum of INR 5 crores.
- The maximum repayment tenure is 20 years.
- Floating rate of interest.
- Transferring existing loans - carry your existing loans and get additional refinance.
- Apply from your home and get services delivered at your doorstep.
Axis Bank: Charges applicable and Documents required
Interest rate
Starts from 11% (Floating)
Processing fee
1% of the sanctioned amount inclusive of the non-refundable login fee of INR 5,000.
Documents required
Application Form
PAN card
Identity proof
Address proof
Date of Birth proof
Signature proof
Proof of Income
Salaried
Self-employed
3 months pay slip.
6 months pay slip / 2 years bonus proof (in case of variable pay).
6 months' bank statement showing salary credit.
2 years Form 16.
For NRI salaried
3-month pay slip
Appointment letter / Contract letter.
Continuous discharge certificate for shipping cases.
6-month Domestic NRE / NRO a/c statement.
6-month international salaried a/c statement.
Overseas credit report.
Valid Visa copy / OCI card
Passport copy.
POA details.
2-year income computation, P&L, Balance sheet - CA authorised.
For Asha Home Loan -1 -year income computation, P&L, Balance sheet - CA authorised.
Tax Audit reports (If gross turnover exceeds 1 crore or Gross receipt exceeds 25 lacs).
6-month bank statement of personal and business accounts.
If ITR filled without digital sign - CPC and tax paid challan.
Business continuity proof ( 5 years for LAP)
Deutsche Bank
Deutsche Bank provides Loans against property to fulfil your personal and business needs at an attractive interest rate starting from 13 % along with a flexible repayment option and can get secured against residential, commercial and industrial property.
Deutsche Bank (Loan against property): Benefits
- Higher loan amounts (Upto INR 15 crore and commercial property loan is upto INR 5 crore)
- Loan against multiple property types
- Easy repayment plan (ranges from 5-15 years)
- Insurance plan for your loan against property
Deutsche Bank: Charges applicable and Documents required
Interest rate
LAP residential - 13%
LAP commercial - 13.50%
Processing fee
Upto 1 %
Documents required
Identity proof
Proof of age
Signature proof
Proof of address
Financials Documents
Salaried
Self-employed
3 months pay slip.
Form 16 or ITR
6 months' bank statement showing salary credit.
HR certification showing all allowances and reimbursements (if any).
Repayment details of any existing loans or loan closure letter.
Last 2 years ITR.
2 years Income computation, P&L, Balance sheet - CA authorised.
Proof of business continuity for the last 3 years.
6-month bank statement.
Short note on the nature of business, form of organisation, client and supplier etc
Conclusion
In today’s module, we have analysed the top 5 Indian banks that offer Loans against property (LAP). HDFC Bank tops the list by providing the best LAP in the country. HDFC Bank offers a huge variety of financial products that are easily processed and quickly available.
Suggested read: MSME Schemes that empower small business in India 2023
FAQS on Which bank is best for loan against property
Is there any application fee for a loan against property?
Money lenders have set application fees including evaluation charges and legal verification process.
Which bank is best for Home Loan against property?
Axis Bank and Kotak Mahindra are best for home loans against property.
Can I get a 100% loan on the property?
No, it is not possible to get a 100% amount of home loan from any lender.
How much can I get a loan against property?
Your lender can sanction the amount upto 75% of the property value.
Is loan against property taxable?
Loan against property is not Tax - deductible.
When it comes to collateral financing, loan against property no doubt gains an upper cut typically for the flexibility of use it comes with.
A loan against property is an end-use restriction-free financing option that comes in high-value, enabling individuals to fulfil their diverse financing needs with ease.
Some of the best lenders also keep other charges competitive to improve borrower affordability.
Nevertheless, it is always prudent to understand the interest rate levy and other charges for a loan against property as it is a critical financial commitment spanning over years.
Some of the factors that affect the rates include –1.The financial institution’s benchmarking systemIt is a common factor for all loans, but has typical RBI intervention when it comes to collateral financing such as loan against property.
Benchmarking is a system that helps determine the minimum rate at which a lender can extend a loan, and is usually connected to an internal or external benchmark.The commercial lending rate is determined by adding the lender’s spread to this benchmark rate.
