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Posted on Wednesday September 9th, 2020

Loan against property is much like any other type of loan in which lender promises you to give the funds by keeping your commercial or residential property as collateral. This concept is gaining popularity among loan seekers as large sum of money gets easily arranged by this. Loan against property offers great features such as easy documentation, faster approvals and flexible repayment options. It means one can apply for a loan from any lending institution by extending his/her property as a security. This is type of mortgage that involves a ‘transfer of interest’ and the ownership of the collateral remains with the borrower. Here in this article, we will tell you about what are the essentials of Loan against Property and why it is attractive as compared to conventional loans. Mortgage loan is convenient as it offers higher loan amounts at discounted interest rate accepting both residential and commercial properties as security. Its major benefits are:

• Large quantum can be financed.
• Lower rates of interest as compared to other loans.
• Longer tenure resulting in low EMIs.
• Efficient financial tool for debt consolidation.
• Multipurpose use either personal or business.

The lender may also ask for KYC documents to validate the eligibility criteria which may consist of:
• Address proof.
• Identity proof.
• Property Papers(Residential/Commercial/Industrial/Plots).
• Salary slip if you are salaried.
• Certified financial statement for last 2 years if you are self-employed.

The approval of loan depends upon borrower’s credit score along with other factors such as age, income, the number of dependents, assets and liabilities. Once you Apply For Loan against Property the lender will evaluate your eligibility depending upon given factors and luckily, if get approved for loan, the amount is disbursed in full or in installments in the bank account of the borrower. One can have choice to pick the type of interest rate either fixed or floating. The quantum of loan extended to the borrower is evaluated on the market price of the property, you pledged to the lender. It is important to keep the fact in mind that every lending institution always holds a certain amount of money and disburse a maximum of 70% of the market value of property. This ensures the lender against any cyclical fluctuations is real estate prices or in case, borrower default on installments.

Loan against property is great financial tool to meet your personal and business needs as there is no restriction on its usage. Many people use mortgage loans for funding children education in abroad, to buy or build a second property or even for business purposes. Putting your property at stake is a serious decision, so go ahead for loan after comparing the different lenders on their websites as many of them offer online loan against property with great benefits and features. The LAP should not be used as risk capital because it has high chances of losing your property to lender, therefore, apply it only when you know that you are able to pay back the loan amount in the fixed period.

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Posted on Sunday May 17th, 2020

Planning to buy a branded car or planning to get a new home somewhere or thinking to expand your business to achieve more success in corporate sector. So much to do in list, but funds is constantly stopping you from going further in life. There are certain financial problems which you face in your life and can be the most stressful thing happens to you. But, don’t freak out as ShubhBank have an option for you that is loan against property. Haven’t planned taking a loan against property or haven’t heard about it before that how could you execute it or how will it be beneficial for you? Here, the answers to all your doubts will be cleared. A loan against property is a secured loan, which involves your property as collateral for security purpose. The Loan against Property at ShubhBank is popular because of its perceptible benefits. Higher loan quantum is generally available for longer tenure when compared to other secured loans, and at an attractive interest rate.

To avail this loan, you will be providing your owned residential property or commercial property to the lending institution in which you’ll be applying. Applying a Loan Against Property at ShubhBank is as convenient as they required minimum documentation, and the interest rates are quite lower than other conventional loans. As convenient as these loans are seen, but they come with certain guidelines which you need to make sure before applying such as the property which you are pledging as collateral should be owned by either you or family, property should be in good condition, and also it should be registered with the government processing. Now, let’s see what benefits should ShubhBank provided you on loan against property to fulfill your requirements.

1. These loans are easy to get from various lending institutions either NBFC or bank. As these are secured loans, the lender feels safe to provide you the funds as they get the benefit of having your property as pledged security.

2. This loan will get you the benefit of prepayments, which means you can close your loan amount before the tenure ends. In these kinds of loans, most of the lenders generally don’t ask for charges while closing loan against property.

3. You can avail the benefit of having access to lower EMIs as the tenure for the loan against property is high, and the rate of interest is low. This option is beneficial for those people who can’t afford a high amount of monthly installments but borrowers who can pay a high amount to repay can opt for shorter tenure also.

4. The longer tenure will provide you the ease of repayment that can’t pay off the heavy amount of EMIs every month. The tenure for this loan can be extended up to 10-15 years depending upon the lender and your eligibility.

Loan against property provide you the funds that help you to fulfill all the plans, you wished for but couldn’t execute due to lack of finances. Now Apply For Loan Against Property to easily plan your dream vacation, destination wedding or send your child abroad for higher studies.

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Posted on Friday November 15th, 2019

A loan against property provides you the capital based on the value of your residential or commercial property. It can be availed by both salaried individuals and self-employed persons. This loan helps you to get funding to meet various personal and business requirements. It can be generally used business expansions, higher studies, and wedding expenses, closing off debts and buying machinery. The loan amount is offered on a certain percentage of the property’s market value usually around 70%-80%. Before applying, there are five factors to consider before taking a loan against property that is discussed below:

• Evaluate Your Eligibility: The eligibility criteria for your loan depend upon the following factors such as age, income source, existing financial responsibilities, credit score and repayment capability and market value of your property. You can also include your spouse or family member as a co-borrower for the loan to improve your eligibility. You need to submit requisite documents that will involve your address as well as income proof and property.

• Choose Suitable Tenure: Loan against property borrowers find longer tenure comfortable but in the long run they end up paying more rate of interest which makes the loan burden for you. Before applying, it is always advisable to understand how much the loan is going to cost you. Always look for the lenders who offer competitive interest rates.

• Repayment option: It is necessary to plan your repayment in advance and have a strategy in place to repay. If you want to pay off your debt in timely manner, you have to make some tough choices. Firstly, it depends upon your repayment option that you chose. There are merits and demerits of every option and the best plan depends upon your income, monthly expenses, and credit score and how much of the amount you want to pay off.

• Co-Borrowers: If the property is linked to multiple owners, they all required being co-applicants while applying for loan against property because it ensures the lender that all owners have agreed to offer the property as collateral to secure the loan. Adding your spouse or child as a co-borrower whether they are co-owners or not helps you to improve your eligibility.

• Read the Terms and Conditions Carefully: Be careful about the processing fee, penalties and add-on charges. It’s not all about to pay the rate of interest only. There are some additional charges like services charges or processing fees. There are also some penalties on pre-payment of loan. Always look after these things while comparing the benefits offered by various lenders. Reviewing it properly helps you in dealing with right lender and always stays cautious about any extra expenses you may incur.

You can apply for an attractive offer on Loan against property From ShubhBank with best possible rate of interest and terms. Just visit our branch in tricity or reach us online at our website ShubhBank.com to enjoy a smooth journey of loan processing and disbursal.

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Posted on Monday September 10th, 2018

Getting LAP for buildings is gaining popularity rapidly. Through the LAP, people can raise their financial resources. Banks or financial institutions typically offer financial resources on your assets. You can take credit from banks on the rented, unused or an occupied property.

Getting your grounds financed is one of the best alternatives if you want to raise up capital. It is disbursed according to the market value of your asset which is normally between 50 per cent to 65 per cent. It is a secured loan type where there is a guarantee given by the borrower who makes use of the resources as a backing security.

You can use your possessions to get funding from banks or money lending companies in order to meet varied business as well as personal requirements. The credit taken on the buildings is used mainly to fulfils wedding expenses, business expansions, buying machinery, higher education and closing off high-cost advances.

Purposes of getting the buildings or resources credited –

It can because of the following reasons people opt to get cash on behalf of their belongings-
● People often take a loan in place of their assets to expand their business.
● Sending their children abroad for higher studies.
● Funding dream vacation
● Funding medical treatment
● Getting their daughter/son married

Eligibility criteria –

One need to accomplish a specific set of eligibility criteria for getting their possession credited. Though, it may vary from one money lending company (bank) to another. Here is the list of some common “Loan Against Property Eligibility” factors that all financial institutions look at-

● Income, savings or debt obligations.
● Value/cost of the mortgaged building.
● Repayment record for credit cards or other borrows etc.

Required documents –

A smooth and simple documentation process eases the borrowing exercise. Most financial institutions or banks usually require some common and important documents in order to transfer particular types of credits. Here is the quick list of loan against property documents required:

1. For salaried customers

● Application form with photograph
● Identity proof
● Residence proof
● Bank statements of last 6 months
● Income proof
● Processing fee cheque

2. For self-employed professionals

● Application form with photograph
● Residence proof
● Valid Identity
● Required education qualifications certificate
● Proof of business existence
● Profit/loss and balance sheet of the last 3 years
● Past 3 years income tax returns
● Last 6-month bank statements
● Processing fee cheque

3. For self-employed businessman

● Application form with photograph
● Residence and identity confirmation
● Business existence proof
● Certification of educational qualifications
● Income tax returns of last 3 years (business and self)
● Profit/loss statement and balance sheet of last 3 years
● Last 6 months bank statements
● Processing fee cheque

Advantages of loan against property

Some of the favorable advantages of taking such financial help are mentioned below-

● Lower interest rates
● Simple approval process
● Flexible repayment tenure
● Continuous ownership
● Optimum use of your valuable at the time of need.
● The best tool for debt consolidation
● Pre-closer

A loan against property is the best source to raise funds. The only drawback of such type of finance is that if the borrower is unable to repay the credit amount fully, the financial institution or bank can take ownership of the mortgaged property.

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Posted on Wednesday May 23rd, 2018

Amongst various loan options provided by banks, comparatively popular product is the Loan against property or mortgage. The product clicks with borrowers because it offers an individual to borrow a relatively large sum of money for any need. It often requires simpler documentation, speedy approvals and flexible repayment options.


According to the Transfer of Property Act, 1882, a mortgage, which is essentially availing a loan against property is “the transfer of an interest in specific immovable property for the cause of securing the payment of money funded or to be given by way of loan, any debt that may give rise to any liability.


This means one can “Apply for a loan from a bank” by extending the property as a collateral or security. However, mortgage only involves “transfer of interest” and the ownership of the property belongs to borrower. Ownership gets transferred to the lender only in the event of default on the loan.

Loan against property or a mortgage is popular because it has some perceptible benefits. Higher loan amounts are offered for longer tenure when compared to other loans, and at a discounted interest rate because of the nature it’s secured. Most banks accept both residential and commercial properties for mortgage.


Its key benefits are:


Good when availing larger amounts


Interest rates are lower


Tenure is longer, which means lower EMI


Good tool for debt consolidation.


Funds can be used for business as well as personal needs.


To fulfill the eligibility criteria lender needs proof of residence, proof of identity, latest Bank Statement reflecting salary / income credit for the past 6 months, salary slip if employed, and relevant copies related to the concerned property the borrower wants to pledge. If the borrower is self employed 3 years income tax return certified by chartered accountant is required .

Loan eligibility just like other loan depends on the borrower’s credit rating along with factors like income, age, qualification, number of dependents, spouse’s income (if any), assets, liabilities, and continuity of occupation. Once the loan is approved is it either disbursed in full or in installments as per borrower discreation. The borrower has an option to choose between fixed and floating rate of interest . There also exists an option for part and prepayment of the loan.

The loan that is sanctioned to the borrower is based on the current market price of the property that is being pledged. However, bank always holds a certain amount of margin money and they generally extend a maximum of 70 % of the market value of the property. This safeguards the banks are protected against any unpredictable fluctuations in the real estate market and a drop in pledged property prices.


Who should opt for it?


Mortgage or Loan Against Property” is required when it comes to need money for your business. While there is no restriction on using it for personal needs, however, if the amount is small, a personal loan can make much more sense.


While people use loan against property for various personal needs like higher education and even to buy/build a second property or to renovate an existing property, most mortgage loans are taken for business purposes. This is especially helpful if the business is in need of emergency cash at lucrative interest rates.


It is always risky to put your property at stake for the cause of fund need. This form of loan shall strictly be avoided if you are starting up and there is a substantial amount of risk involved in your business. Loan against property should be opted only when borrower is capable to pay back the money to lender and shall never be opted as risk capital at the cost of own property surrender.

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Posted on Monday April 16th, 2018

A loan against property is a good alternative if you need capital. Your property must have no outstanding ownership dispute associated with it and should not be mortgaged. If you can make repayments from your earnings. There is various eligibility criteria that you will need to meet to be Able to “Get a Loan Against Property“. Loan against property is given as a certain percentage of the market value of the property which is generally between 50% and 65%. In case of land/ commercial property value to loan amount varies between 50 -65%. This loan belongs to the category of secured loan where there is a guarantee given by the borrower who uses the property as a collateral security. In the event of non paying the loan on schedule, bank after serving proper notices can repossess the property. Loan Against Property can be taken for following purposes like expanding your business, get your child married, send your child for higher studies, fund your dream vacation, fund medical treatments etc. In nutshell, loan against property is a secured multi-purpose loan with larger tenor and lesser rate of interest.