Loan Against Property :
A mortgage loan against pre-owned residential, commercial or industrial property is known as Loan against Property. It is usually taken for business expansion, asset acquisition, marriage or higher education purposes, etc. The rate of interest for LAP will always be higher than Home Loan. The maximum loan offered is 50% to 75% of the property value and the maximum loan tenure is 15 years for any borrower. Most banks or financial institutions require 5 years of business or employment vintage to avail a loan against property.
Documents Required:
For any loan application, a minimum set of documents are generally required by any financial institution in order to process the application. The list of documents required are as follow:
- Identity Proof: Identity proof can include PAN card, Aadhar card, Voter ID card, Passport, etc.
- Address Proof: Address proof can include Aadhar card, Passport, Utility Bills, etc.
- Income Proof: Income proof can include ITR documents, Form 16, Salary slips, Form 26AS and Bank statements.
- Business Existence Proof: This is usually required in the case of a self-employed borrower and can include a GST registration certificate, trade license, partnership deed, etc. In the case of a self-employed professional like CA or Doctor, a certificate of practice and degree is also required.
- Loan Details: This includes sanction letter or repayment schedule of any existing running loans along with its repayment bank account statement.
- Property Documents: This includes a complete chain of property documents like sale deed, conveyance deed, allotment letter, sale-purchase agreement, possession letter, etc., and certificate of approved sanctioned maps and plans for construction.