Understanding the Process of LAP Loan

What Is The Process Of Getting A Loan Against My Property?

What is Loan Against Property?

Loan against property, or LAP, is a long-term, secured credit available for both salaried and self-employed individuals. This type of advance is provided against a mortgaged property, which acts as a security against the sanctioned loan amount Property loan can be availed against various types of properties, including residential, commercial, rented, or selfoccupied real estate.

How To Apply For A Property Loan?

Most financial institutions offer easy online applications for prospective borrowers looking to avail a loan against property.

However, one must follow certain steps to ensure a hassle-free application process.

Let’s take a look.

1.Conduct Thorough Research

There are several financial institutions that offer these loans to eligible applicants but at varying terms of lending, which may or may not be equally beneficial to the borrower. It is the main reason why conducting thorough market research is essential before applying for any particular financial product.

It is essential to know the key details, like an applicable loan against property interest rate, repayment terms, processing fees, statement charges, foreclosure charges, EMI bounce charges, etc. before proceeding to apply.

2. Check Your Loan Amount Eligibility

After shortlisting a particular financial institution that offers the most expansive benefits, one should check the loan amount they are eligible for before applying for a loan against property. Financial institutions determine the loan amount depending on various factors, including one’s means of earning (whether he or she is salaried or self-employed), monthly income, location of the property, previous credit history, credit utilisation ratio, fixed obligations to income ratio, etc.

3. Check The Eligibility Criteria

Every individual needs to fulfil a certain loan against property eligibility criteria required by the lender to apply. Although the detailed eligibility requirements vary among different lenders, some of the common factors include – 1. Applicant’s age.

2. Monthly income.

3. Credit score and credit history.

4. Any existing debts.

5. The current market value of a mortgaged property.

4. Necessary Documents

Financial institutions will also require certain documents to verify an applicant’s eligibility for a mortgage loan. Some of the common documents required to apply for a LAP include – Proof Of Income – Bank account statement, latest salary slip, Income Tax Return, etc.

Proof Of Identity – Aadhaar Card, PAN Card, Voter ID, Passport, etc.

Proof Of Ownership – Copy of property ownership papers is also

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