What is a Property Loan?

A Property Loan, also known as Loan Against Property (LAP), is a secured loan where a borrower mortgages a residential, commercial, or industrial property to raise funds. These funds can be used for business expansion, working capital needs, debt consolidation, or other business purposes. Since the loan is secured by property, it offers lower interest.

Benefits of a Property Loan

  • High Loan Amount: Get a higher loan value based on property market value.

  • Lower Interest Rates: More affordable compared to unsecured business loans.

  • Longer Repayment Tenure: Flexible tenure ranging up to 15–20 years.

  • Business Growth Support: Ideal for expansion, machinery purchase, or working capital.

  • Retain Property Ownership: Continue using the property while it is mortgaged.

  • Improved Cash Flow: Manage business expenses without financial strain.

  • Tax Benefits: Interest paid may be tax-deductible as per applicable laws.

Eligibility Criteria for Property Loan (Business Purpose)

Eligibility may vary by lender, but commonly includes:

  • Applicant must be an Indian citizen

  • Age: 25 to 65 years

  • Applicant Type: Self-employed, business owners, professionals, companies

  • Business Vintage: Minimum 2–3 years of business continuity

  • Income Stability: Regular and verifiable business income

  • Credit Score: Preferably 650 or above

  • Property Type: Residential / Commercial / Industrial (clear and marketable title)

Documents Required for Property Loan

KYC Documents

  • PAN Card

  • Aadhaar Card

  • Passport / Driving License / Voter ID

Income & Financial Documents

  • Bank Statements (last 6–12 months)

  • Income Tax Returns (last 2–3 years)

  • Profit & Loss Statement and Balance Sheet

Business Proof

  • GST Registration

  • Shop Act / Trade License

  • Partnership Deed / MOA / AOA (as applicable)

Property Documents

  • Sale Deed / Title Deed

  • Approved Building Plan

  • Property Tax Receipts

  • Encumbrance Certificate

  • Occupancy / Completion Certificate (if applicable)

Other Documents

  • Passport-size photographs

  • Loan application form