Loan Against Property

Calculate Your Monthly EMI for Loan Against Property

It is a customised online tool that allows applicants to calculate their monthly loan against property instalment in advance. It helps customers to plan their finances effectively. The calculator uses three variables that are the loan amount, repayment tenure, and rate of interest for computing EMI. All you have to do is, input the variables and get the desired result.

Apply for Loan Against Property

Apply for Loan Against Property - Get a Loan Amount up to ₹7.5 Crore

A loan against property (LAP) is another form of secured loan. Self-employed and business owners can avail of this loan after mortgaging their property as collateral. It comes with a lower interest rate because the sanctioned amount is determined based on the valuation of the property. As the collateral is commercial or residential property, customers can obtain a large amount as compared to other loan forms.

LAP helps businesses to expand. It helps you to maintain ownership of your property without having to worry about meeting your financial obligations.

Features and Benefits for Loan Against Property Loan

Mortgage loan amount

The amount you receive can be anywhere between INR 20 lac and INR 7.5 crore, depending on the market value of your property and other eligibility factors.

LTV Ratio

The Loan-to-Value (LTV) Ratio can reach up to 75% of your property's value, providing you with sufficient funds to achieve your objectives and allowing you to secure a larger loan amount based on your property's worth.

Flexible Tenure

The LAP repayment tenure can go up to 15 years. Thus, it helps borrowers to pay off their EMIs without any hassle.

Low-Interest Rate

Take advantage of competitive interest rates offered by Hero Fincorp's Property Loan, guaranteeing affordability and efficient cost-effective financing.

Hassle-free Documentation

Simplify the loan application process with Hero Fincorp's Property Loan, as we ensure hassle-free documentation for your convenience.

Easy Repayment & Longer Tenure

Benefit from adaptable repayment alternatives and an elongated loan duration through Hero Fincorp's Property Loan, ensuring ease in handling your financial matters.

Loan Against Property Eligibility Criteria

Applicants planning to avail of a loan against property need to fulfil certain eligibility criteria as detailed below.

Age

An Indian national with a minimum age of 25 years and maximum age of 75 years.

Citizenship

Verify your Indian citizenship status to fulfil the criteria for the instant mortgage loan.

Employment Status

If you meet the requirements for an immediate mortgage loan. For the loan to be authorized, your company must have operated for at least three years.

Business Status

Applicants should be in the business for at least 3 years.

Maximum Loan Tenure

The loan is available for a flexible tenure of 15 years.

Occupation Status

You must run a successful firm. People in the salaried class are ineligible for our mortgage loan.

Note: We do not provide Loan Against Property to salaried individuals.

Documents Required For Loan Against Property

Before applying for a loan against property, applicants must have the following documentation on hand.

Mandatory Documents

Duly filled application form, PAN Card

Proof of Identity

Aadhar Card, ID Card, Driver's License, and Identity Card issued by GOI

Proof of Address

Passport, Driver's License, Utility Bill, Voter ID Card, Lease/ Rent Agreement, Registry Copy, Property Tax Receipt, GST Certificate

Proof of Business Existence

GST Certificate, UDHYAM Certificate, Partnership Deed Copy, Trade License, Certificate of Practice

Signature Proof

Banker's Verification, Passport, PAN Card

Proof of Income

Last three years' Income Tax Returns (ITRs), Income Statement, Profit and loss Statement Balance Sheet, Bank Account Statement (previous six months)

Property Related Documents

Complete set of documents pertaining to the property in question

How does Loan Against Property (LAP) Interest Rate Work?

Hero FinCorp provides customers with an option to choose between fixed interest rate and floating interest rate. The interest rate has a direct impact on your EMI amount and repayment tenure.

Fixed Interest Rate - It means you pay the same interest rate throughout your loan repayment tenure. Here, the EMI remains the same during the whole loan tenure.
Floating Interest Rate - This type of interest rate fluctuates in response to market conditions. As the interest rate fluctuates, the EMI also keeps on changing. We calculate the interest rate using a base rate or index rate set by RBI. Therefore, when the base rate increases, the floating rate also increases and vice versa.

Charges Associated with Loan Against Property

Processing Fees - This fee is charged to cover the cost incurred during the processing of your loan.

Legal/Technical Fees - Before providing any funds, we assess the property valuation and the risk involved in the property by collecting all the legal documentation and by physically verifying the property and documents. To initiate this process, you may be charged with the legal fee.

Pre-Payment and Foreclosure Charges
(a) These depend on the type of the interest rate—whether it is floating or fixed interest rate.

(b) There are predefined charges for prepayment and foreclosure of the loan. Read the loan agreement carefully before applying for a LAP.

Why Choose Hero FinCorp For Loan Against Property?

Loan amount

Hero FinCorp offers mortgage loans up to 75% of the collateral value.

Tenure and interest rates

Low-interest rates and long tenures make LAP loans an attractive option when you need a large sum of money.

Variety of collaterals accepted

Hero FinCorp accepts almost all kinds of property as collateral. They can include land, building, apartment, factory, shops, hospitals, schools, and more.

Multiple repayment modes

You can repay your loan through online payment, Electronic Clearing Service (ECS), or National Automated Clearing House (NACH).

Doorstep document collection

Customer relationship professionals visit your home to collect all the necessary documents.

Fast processing

It takes only about 7 to 10 days to process a loan against property in India if you are eligible and all the documents are in place.

What Do Mortgage Lenders Consider?

Stable Income - Lenders prefer borrowers with a steady and reliable income. There are fewer chances of getting a loan against the property if you don't have a stable income or if you earn by speculative means.

Age Factor - As the borrower’s age increases, earning potential decreases. As such, financial institutions are more likely to lend to young people who are starting a job or business than those who are nearing retirement or have retired.

Occupation - Salaried people have a fixed income, unlike businesses or self-employed people, whose earnings fluctuate with market conditions. Considering this risk factor, lenders prefer salaried over non-salaried professionals.

Place of Residence - Loans are not available on agricultural property or land that does not have government approval. As a result, the location of your residence and the property you are willing to mortgage is crucial.

How Can Loan Against Property Be Used?

Business / commercial purposes -A loan against property in India can help you expand your business, buy machinery or a new plant, maintain cash flow and working capital, or finance a new project.

Consolidation of debt - LAP loans can help you consolidate several small but high - priced loans into one bigger loan, which is low-priced and has a higher tenure. Your loan amount will also increase.

Lease rent discounting - LRD is the process in which you can use rental receipts from your property as security to get a LAP loan from Hero FinCorp. This way, the money you get as rent will go into paying off the EMIs. Consequently, you will be able to use the loan against commercial property or residential property to buy new properties and get tax deductions.

New commercial property - You can use LAP to buy new commercial property, expand your business, earn more revenue and pay off your loan.

When Should You Take A Loan Against Property For Your Business?

Maintaining and expanding inventory requires sufficient funding and this expense is unavoidable. It is necessary to provide customers with more options and meet changing demands. A mortgage loan can help.

Replacing or repairing old machinery or buying the latest ones requires a lot of money. A loan on property can do the trick and help you handle production or serve customers efficiently. It will also eliminate your risk or liability that comes from using an outdated or faulty equipment.

Unsold inventory or late payments from customers can affect your cash flow negatively. Plus, expenses associated with rent, staff and utilities can add to the worry. By taking a LAP loan, you can ensure smooth operations and cover losses.

When you want to grow or expand your business, funds should not hold you back. Take a loan against property to hire more employees, buy a new place, advertise, or give your business a new look.

Frequently Asked Questions (FAQs)

Which finance company is best for a loan against property?

Hero FinCorp is one of the best finance companies. We recommend offers based on borrowers desired interest rates, loan amount, repayment terms, and other features.

What is the minimum and maximum mortgage loan amount I can apply for?

The minimum and maximum mortgage loan amount for a loan against property would vary based on the property offered as collateral.

Is there an application fee for Loan Against Property?

Yes, there may be an application fee for a loan against property, which may vary based on the loan amount. So clarify all applicable fees and charges with the lender before applying.

How to get the best mortgage loan at a low interest rate?

1 - Check your eligibility and EMI Check your loan eligibility and calculate EMI before applying for a loan against property (LAP). Use the Loan Against Property EMI calculator to know the monthly instalments. Choose an EMI that best suits your budget. Check your eligibility based on your age, income, property type, LTV ratio and debts. If you have a strong profile, you may get a low-interest mortgage loan. 2 - Check property status and its legal documents The property against which you plan to take a loan must have a clean title and should be free from any legal disputes. The applicant must have the required statutory and government approvals along with the entire set of property documents. 3 - Explore the options Most financial institutions allow the borrowers to choose between a fixed rate of interest and a floating rate of interest. Compare both interest rates to know the difference in terms of the financial burden and choose the one that suits you the best. 4 - Compare Charges There are various costs attached to a loan against property. These charges include processing fee, part-prepayment charges, foreclosure fee etc. Compare the additional fee and charges with different lenders before applying for a LAP.

Why Choose Loan Against Property?

High loan amount - Since we offer LAP against a house, piece of commercial property, or something similar, the loan amount you receive is higher than any other loan type. Long Tenure - We provide a LAP for a maximum period of 15 years. As such, you could repay your loan without hampering the profitability or cash flow of your business. Low-interest rates - The interest rate on a loan against property is low since your collateral is valuable. Hence, your EMIs will be lower and more affordable than in the case of loans. Easy to obtain - Since you are providing sufficient collateral, getting this loan can be super easy and quick.

How does a financial institution calculate the LAP amount that can be funded?

Financial institutions determine the LAP value through the property's value and applicant's profile based on his/her net income, age, debt-to-income ratio etc.

Can I take a LAP against the rented property?

Yes, LAP can be availed on a rented property. Though, the LTV ratio may differ in this case.

Can I get the rate conversion done as per the prevailing interest rate?

Yes, borrowers can take the rate of conversion benefits.

Can I transfer my LAP to another financial institution for an increased amount or tenure?

Yes, borrowers can transfer the LAP to another financial institution for an increased amount or tenure or both.

Can I avail a part disbursement under LAP as per my need?

Yes, the borrowers can avail of part disbursement of their LAP.

Can I sell the property during the loan tenure?

Yes, provided that either the buyer of the property pays the loan liability or the customer makes the balance payment.

What is the difference between a home loan and a LAP?

A home loan is taken to purchase or build a property, whereas LAP does not have any restrictions on its usage. In both cases, the property is kept as collateral with the lender.

How to calculate the present floating rate of interest on my LAP taken some time ago?

If you have a floating interest rate, the calculation for the same would be specified in the loan agreement. The formula can be prime lending rate (PLR) minus spread. To calculate this, you can check the loan agreement where a negative spread is mentioned and deduct it from the PLR of your respective financial institution.

Can I take a top-up loan on my LAP?

Yes. If you have paid your EMI dues on time, you can avail of a top-up loan on the LAP.

Can I avail LAP with any loans?

Yes. If you have paid your EMIs on time and have a satisfactory debt-to-income ratio, you can avail of a LAP with loans.

For what purposes can you avail Loan Against Property?

You can avail Hero FinCorp’s Loan Against Property (applicable for both, Residential & Commercial Properties) for business purposes and activities which are not speculative or non-prohibitive.

How is my loan amount eligibility decided?

We decide your loan amount based on your repayment capacity. Further, the repayment capacity is considered on the basis of income, age, number of dependents, qualifications, spouse's income, assets, liabilities, stability and continuity of occupation and savings history. In addition to considering these factors, the maximum amount shall not exceed 75 per cent of the value of property.

Who can be co-applicant to the loan?

You may include your spouse as a co-applicant for the Loan. His / her addition as a co-applicant can enhance the loan amount. Please note: all co-owners of the property should necessarily be the co-applicant.

How is the loan repaid?

The repayment of loan is done in Equated Monthly Instalments (EMIs). This comprises principal and interest. Repayment by EMI commences from the next month in which you take full disbursement.

What is Pre-EMI interest?

Post final disbursement, you have to pay interest on the portion of the loan which is disbursed. This interest is called pre-EMI interest. Pre-EMI interest is payable every month, starting from the date of each disbursement up to the date of commencement of EMI.

What security/collateral will I have to provide?

The security/collateral for the loan will be the first mortgage of the property. Collateral security such as assignment of insurance policy or any such other assignable financial instruments would suffice the need, the title to the property needs to be clear, marketable and free from encumbrance. Most importantly there should not be any mortgage, loan or litigation on the property. To elaborate, there should not be any mortgage, loan or litigation which is likely to affect the title to the property adversely.

Can I repay the loan ahead of schedule?

Yes, you can as per the terms mentioned in your loan agreement.

Does the property require insurance?

Yes, the property has to be duly and properly insured for fire and other appropriate hazards, as required by Hero FinCorp.

Are Hero FinCorp policies subject to change?

Yes, these policies periodically reviewed.

How can I check my eligibility and loan amount?

The following factors are considered to determine eligibility and loan amount Age Income Valuation of the Property obligations Stability/continuity of employment/business

If a property is jointly owned by an individual and his/her relatives, can he/she take a loan against this property?

It is necessary for all the co-owners of the considered property to be in as co-applicants to the loan.

What is the tenure of the loan?

Repayment of loan can be done over a maximum tenure of 15 years. Beyond the age of retirement or on reaching 60 years of the age, the repayment will not be ordinarily extended. However, Hero FinCorp will endeavour to determine the repayment period to suit your convenience.

What are the end uses of the loan against property which can be sanctioned by Hero FinCorp?

Business needs Mortgage buyout/Balance Transfer of loan Consolidation of debt

How long does it take to process a Loan Against Property application?

The processing of the loan against property application usually takes 7 to 10 working days, post submission of all required documents.

Is it necessary to insure the property?

Yes, you need to make sure that the property is absolutely insured for fire and other hazards, as required by Hero FinCorp, during the tenor of the loan you would be required to produce evidence to us each year or a proof as asked for.

How is the Equated Monthly Instalment (EMI) calculated?

Based on the loan amount, the repaying period and the interest rate on the borrowing amount the EMI is calculated. The EMI is subjected to change when interest rate changes or a part-payment of the Loan is made. Every month, part of the EMI is adjusted towards the interest payable and the balance is adjusted towards repayment of the principal.

What are my different options for making my EMI payments?

You may repay your LAP in any of the following three ways: Electronic Clearing Service (ECS), National Automated Clearing House (NACH) & Online Payment.

How can I make a request to foreclose my Loan Against Property account?

Kindly submit a written request to your nearest Retail Loan Service Centre to close your account. Our customer service desk will provide you with the necessary assistance.

How do I apply for a Loan Against Property (LAP)?

You can apply for a loan in the following ways: Call our Customer Care numbers provided on the website Visit your nearest branch Our liability customers may also get in touch with their Relationship Managers/ Personal Bankers to know more and apply for LAP.

What Property can be considered as collateral for LAP?

Properties which are self-occupied Residential or Commercial for example shops and offices can be considered as collateral.

What is the maximum loan I can get against my Property?

You can get a Loan Against Property up to a maximum of 75%* of the market value of your property. **conditions apply

Is there any minimum Credit Score requirement?

There is no specific credit score requirement as per Hero FinCorp Limited policy. However, it is under the discretion of Hero FinCorp to accept or reject any loan application basis any irregularity noticed in the rating.