Top Five Things to Know Before Applying for a Loan Against Property
A loan against property is a smart and versatile financing option that lets you unlock the value of your real estate to meet various financial needs—whether it’s expanding your business, funding higher education, managing medical expenses, or tackling unforeseen costs. With high loan amounts and competitive interest rates, it serves as a reliable way to secure funds when you need them most. To make the most of this facility, it is important to understand the eligibility requirements, application process, and associated costs.
Bajaj Finance makes this easier with attractive rates, fast approvals, and flexible repayment plans. Below are five key aspects to review before applying for a loan against property.
1. Eligibility criteria
Before applying, ensure you meet the lender’s essential requirements, such as:
Age: Generally between 25 and 85 years
Income stability: Both salaried and self-employed individuals should show consistent income
Property details: The property must be legally sound and may be residential or commercial; its market value determines your loan amount
Credit score: A score of 700 or above enhances your chances of better loan terms
Existing liabilities: Current financial commitments may affect your approved loan amount
2. Loan-to-Value (LTV) ratio
The LTV ratio reflects the portion of your property’s market value that the lender is willing to finance—typically between 60% and 75%. For example, if your property is valued at Rs. 1 crore, your eligible loan amount may range between Rs. 60 lakh and Rs. 75 lakh. Understanding this helps you set clear expectations.
3. Loan process
Being aware of the loan journey ensures transparency and faster completion:
Application: Submit your form along with income proof, identification documents, and property papers
Property valuation: The lender assesses your property to determine its value and corresponding LTV
Credit evaluation: Your credit history and financial stability are reviewed
Approval: If you meet all criteria, you receive an offer letter outlining the loan terms
Disbursement: Once accepted, the loan is disbursed, and your property is mortgaged
4. Interest rates and charges
Loan Against Property interest rates usually fall between 9% and 12% per annum. You must also factor in additional charges such as:
Processing fees: Up to 3.54% of the loan amount
Prepayment charges: Up to 4.72% on early repayment
Legal and valuation fees: One-time charges for verification and assessment
Bajaj Finance keeps costs competitive and transparent, offering minimal additional charges. You can conveniently calculate EMIs using Loan Against Property EMI Calculator, track your loan, and apply through the Bajaj Finserv App.
5. Choosing the right lender
The right lending partner can significantly simplify your experience. Bajaj Finance offers:
Swift approvals and fast disbursals
Repayment flexibility with tenures of up to 15 years*
Complete digital loan management through the Bajaj Finserv App—track EMIs, download statements, and explore exclusive benefits
Conclusion
A loan against property is an effective way to access substantial funding by utilising your property’s value. By understanding eligibility norms, the LTV ratio, the application process, interest rates, and lender offerings, you can make an informed decision. With Bajaj Finance, you benefit from competitive rates, a smooth application journey, and a user-friendly app for seamless loan management.
*Terms and conditions apply.
