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Loan Against Property (LAP) or mortgage loan is a type of secured loan offered by banks and Housing Finance Companies (HFCs) against commercial or residential property owned by the borrower. The amount, which is availed by keeping the property as collateral till the loan is fully repaid, can be used by the borrower for various purposes like expanding a business, funding children’s education, meeting medical expenses, and more. The maximum loan amount provided under LAP can go up to 70% of the property value. Along with being cost-effective, loans against property are reasonably convenient to avail and repay due to the relatively low mortgage interest rate.

Features and Benefits of Loan Against Property:

The availability of higher loan amount and the flexibility to use the amount for various purposes make LAP a better option compared to a personal loan. Mentioned below are some of the features and benefits of availing a Loan Against Property.
1) The loan is available against self-occupied residential property, such as house, apartment, flat, etc.
2) It is also provided against rented residential properties.
3) It is available by mortgaging commercial properties like an office building, malls, shopping complex, shops, etc.
4) It can be taken against a plot of land owned by the borrower.
5) Available for both salaried and self-employed individuals.
6) Interest paid for the Loan Against Property provides tax benefits under Section 37 (1) of the Income Tax Act, 1961.
7) If the amount is used for funding a house, the interest paid on the loan provides tax benefits under Section 24 of the Income Tax Act, 1961, up to an amount of Rs. 2 lakh

Loan against Property Eligibility Criteria:

The eligibility criteria for availing LAP varies from provider to provider. However, to provide you with an overview of the minimum requirements, mentioned below are some general conditions.
- Applicant must be an Indian national. - He/She should be at least 21 years at the time of submission of the loan application. - Applicant must have been employed by the current organisation or should have been involved in the current business for a specific number of years - Applicant must have a good credit score, demonstrating his/her history of successful repayments.

Documents Required for Taking Loan Against Property

Salaried Individuals

Self Employed

Duly signed application form with photograph(s)

Duly signed application form with photograph(s)

Identity proof, address proof and age proof

Identity proof, address proof and age proof

Salary slips of last 3 months

Financial statements, including balance sheet, profit and loss account statements

Bank statements

Bank statements

Latest Form-16 and Income Tax Return (ITR) details

Income Tax Return (ITR) details of last 3 years

Title documents of property

Title documents of property

Proof of total work experience

Business existence proof