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Loan Against Property (LAP) – Complete Guide

Unlock the hidden value of your assets. A Loan Against Property (LAP) allows you to pledge your residential, commercial, or industrial property as collateral to borrow funds for any financial need without losing ownership.

Your property isn’t just an asset — it can act as a powerful financial backup offering lower interest rates compared to personal loans.
Starting Rate9.25% onwards
Max Tenure20 Years
Max AmountUp to ₹7.5 Cr

What is a Loan Against Property?

A Loan Against Property is a secured loan where you pledge your residential, commercial, or industrial property as collateral to borrow funds. The loan amount is usually a percentage (50%–75%) of the property's current market value.

Current LAP Interest Rates (2025)

Bank / NBFC Interest Rate (p.a.) Maximum Loan / LTV
SBI10.60% – 11.30%Up to ₹7.5 Cr
HDFC9.50% – 11.00%65% of property value
IDFC9.25% onwards50%–70% LTV
Tata Capital14.25% onwardsDepends on value
Axis Bank10.50% – 10.90%Up to ₹5 Cr
Kotak Bank9.50% onwardsUp to ₹5 Cr
Bank of India10.10%Up to ₹5 Cr
LIC Housing9.70% – 11.55%₹2 Lakh+
PNB Housing9.24% – 12.75%70% LTV
ICICI Bank10.85% – 12.50%75% LTV

*Rates are indicative and subject to change based on borrower profile.

Key Features of LAP

High Amount

₹2 Lakh to ₹5 Crore.

Lower Rates

Starting at 9.25%.

Long Tenure

Up to 20 years.

Flexible EMIs

Fixed & Step-up plans.

✅ Usage of Funds

  • Business expansions or working capital.
  • Higher education or marriage expenses.
  • Medical emergencies or high-cost treatments.
  • Debt consolidation or personal investments.

💡 Additional Benefits

  • Simple documentation & fast processing.
  • Accepts residential, commercial & industrial property.
  • Overdraft facility available in select banks.
  • Tax benefits available on interest (purposed use).
Eligibility Criteria
CriteriaSalariedSelf-Employed
Age Limit21 – 65 yrs21 – 70 yrs
Annual Income₹2.4 L+₹2.5 L+
Experience3 Years3 Years

📊 Property Valuation

  1. Professional market valuation inspection.
  2. Comparison with similar local assets.
  3. Legal title verification (Clear Title).
  4. Assessment of location & condition.
Tip: Stable income & 750+ CIBIL score can increase your LTV ratio up to 80%.

Documents Required

Basic Proofs

  • Identity Proof (PAN, Aadhaar, Passport)
  • Address Proof (Voter ID, Utility Bills)
  • Date of Birth & Signature Proof

Income Evidence

  • Salaried: 3mo Slips, 6mo Statements, Form 16.
  • Self-Employed: 3yrs ITR, P&L, Audited Balance Sheet.
  • NRI: Overseas Income Proof & Passport copy.

Closing Summary: A Loan Against Property is a smart financing option for those needing large funds at lower interest rates. It allows you to leverage your real estate asset without selling it. Compare interest rates and processing fees before applying.

Frequently Asked Questions

How much loan can I get?
Typically, banks finance 50% to 75% of the property value, and some lenders go up to 80%.
Which properties are accepted?
Residential (houses/flats), Commercial (shops/offices), and Industrial properties are accepted.
Can I prepay the loan?
Yes, most lenders allow prepayment, though minimal charges might apply for fixed rate loans.
Are there tax benefits?
Yes, if used for business or specific purposes, you can claim interest deductions under income tax sections.