What is the minimum amount that can be availed as a Loan against Property?

A loan against property is a secured credit option that can be availed to meet any personal or business requirements. However, the minimum amount an individual can avail of with a loan against property depends on the market value of a particular property. 

In addition, applicants need to meet the loan against property eligibility set as per a lender’s requirement. Although that is not all, one needs to keep in mind the pointers that affect his/her eligibility to avoid facing rejection. 

Factors that affect loan against property 

Individuals can avail of a considerable loan amount with a LAP. However, they must know the crucial factors that affect loan against property eligibility and proceed accordingly: 

1. CIBIL score 

The eligibility criteria of every credit instrument are affected by the CIBIL score of an applicant. Lenders usually recommend borrowers to maintain a score of 750 and above as this ensure a better chance of loan approval. Furthermore, they can also negotiate and get affordable loan against property interest rates based on this score. 

2. Applicant’s age 

An applicant’s age also falls under this gambit. Typically, lending institutions prefer to sanction loans to young borrowers due to their repayment capability and years of employment. However, aged individuals can show their additional source of income from rent, investments, part-time business etc., to convince a financial institution and secure a LAP.

Must Read: Check Your Loan Against Property Eligibility for Quick Benefits

3. Employment status 

Financial institutions consider an individual’s employment profile before approving a loan. It is essential that an applicant has a stable source of income as this will convince financial institutions of his\her repayment capability. Although, it must be brought to the forefront that individuals who frequently switch jobs have a high possibility of rejection.

Additionally, self-employed individuals can apply for a credit by establishing the revenue stability of their venture.

4. Property condition and location

The market value of the property is depended on the age and condition of the property. Furthermore, applicants must submit valid documents along with it. These include the registration papers, permission papers, clearance bills etc. Moreover, the applicants should check if their property is insured or not.

Besides these, one should also understand the location of a property plays a part here as well. Properties at a prime location with better amenities will fetch a higher resale value, thus increasing the eligibility of a borrower to secure this financial product.

Thus, potential borrowers must meet the loan against property eligibility to gain substantial funds. However, they must also maintain a healthy credit repayment habit to establish their credibility as a borrower.