A Loan Against Property (LAP) is a loan disbursed against the mortgage of your property with the lender. From financing your business's expansion to funding your kid's education to taking care of emergency medical expenses, a Loan Against Property can help you manage any financial emergency.

Loan Against Property (LAP) is a secured loan that is granted by financial institutions using residential or commercial property as collateral. The borrower pledges their owned property in return for a loan amount, typically up to a certain percentage of the market value of the property (usually 40% to 70%). This type of loan is popular for its relatively lower interest rates compared to unsecured loans, as well as the higher loan amounts that can be availed.

Key Features of Loan Against Property:

1. Secured Loan: Since the loan is backed by property, it is considered a secured loan, which reduces the risk for the lender.
2. Loan Amount: The loan amount is usually a percentage of the property's market value, generally ranging from 40% to 70%.
3. Lower Interest Rates: LAP typically offers lower interest rates compared to unsecured loans like personal loans, since it’s backed by an asset.
4. Longer Tenure: The repayment period is flexible, with tenures ranging from 5 to 20 years, allowing borrowers to repay in affordable EMIs.
5. Flexible Use: The loan amount can be used for a variety of purposes such as business expansion, education, medical expenses, weddings, or debt consolidation.
6. Ownership Retained: Even though the property is used as collateral, the ownership remains with the borrower as long as repayments are made.
7. Eligibility: Both salaried and self-employed individuals who own residential or commercial property are eligible. Lenders assess factors like the borrower's income, credit score, and property value.
8. Processing Time: The loan processing time can take a little longer compared to personal loans, as the lender needs to evaluate the property and verify documents.

Common Requirements:

• Property Documents: Proof of ownership, clear title, and valuation documents.
• KYC Documents: Identity and address proofs.
• Income Proof: Bank statements, salary slips (for salaried individuals), or business financials (for self-employed individuals).
• Credit Score: A good credit score can improve eligibility and lead to better terms.

Loan Against Property is an ideal choice for those looking for a substantial loan amount at a lower interest rate without having to sell or lose ownership of their property.