Loan Against Property

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Simply put, a loan against property is what it actually connotes — a loan given or disbursed against the mortgage of property. This is unlike a personal loan, which is disbursed to an individual. The loan is given as a certain percentage of the property’s market value (usually around 40 per cent-60 per cent).

The loan could be used for meeting any personal / Business requirements of the borrower such as marriage expenses, further studies / business expansion , etc. On the basis of the type of property being mortgaged; loan against property can be of two types:

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    Loan against commercial property: The loan availed against commercial property mortgaged is termed as loan against commercial property. While providing loan against commercial property, the bank verifies the type of commercial property, its usage and occupancy. Most of the banks offer loan only if the commercial property is self occupied. The maximum loan under this scheme can be up-to 50% of the market value of the property.

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    Loan against residential property: The loan availed against residential property mortgage is called loan against residential property. Customer can mortgage his/her residential property like house or plot to avail this loan. The maximum loan under this scheme can be up-to 60% of the market value of the property