Loan Against Property Eligibility

Mortgage loan is approved based on eligibility criteria for loan against property. So, it becomes imperative to know the mortgage loan eligibility. The following factors are considered by banks to estimate your mortgage loan eligibility:

Minimum and Maximum Age	18 to 70 years However, some banks also give mortgage loan at the age of 18 years to self employed and salaried customers.
Net Monthly Income	Net monthly income of salaried co-applicants should be ₹ 40,000 or more. Minimum annual income of self employed should be ₹ 3 Lakh and above.
Loan Tenure	Maximum loan tenure up to 20 years
Interest Rate	6.90% to 11.60% Interest rates vary with the property type. Generally, interest rates on loans taken against residential properties are lower than loans taken against commercial or industrial properties.
Employment history	For salaried co-applicants, minimum work experience of 3 years is required For self employed, business existence of minimum 5 years and ITR of 3 years is required. Note: Business with net investment up to ₹ 5 Cr may be eligible for concessional rate of interest on LAP under priority sector lending.
LTV	Banks typically give mortgage loan at LTV of 1% to 80%. The LTV ratio– differs by type of property. Loan against industrial property – 80% Loan against residential property – 80% Loan against commercial property – 80% Banks give loan based on market value or registered value of the property, whichever is lower.
CIBIL score	CIBIL score of 650 and above is considered as a minimum cut off score to be eligible for a Loan against property.
Property approval and documents	The builder and property against which you are taking loan should be approved by banks. Registered Sale Deed/ Conveyance/ Lease Deed, Past Sale Deeds Chain (each transaction in respect of this property since first allotment, Latest House Tax Return/ Receipt, Approved Building Plan from Municipal Corporation).

Loan against property eligibility is calculated based on CIBIL, Salary, value of property, LTV and other obligations. Let’s understand this by an example:

Illustration – Mr. A is 30 years old and needs a loan to expand his business. He is willing to mortgage his commercial property with a market value of ₹ 60 Lakh. His net income is ₹ 50,000 per month and he has no other fixed obligations. Banks will calculate Mr. A’s loan amount eligibility based on his age, net income and his fixed expenses obligations as a per cent of his net income. Based on his eligibility calculation, various banks can offer different interest rates to Mr. A with different EMIs. He should choose the bank which offers the highest loan amount eligibility with lowest interest rate and lowest EMI.

Bank	Loan Amount Eligibility	Interest Rate	EMI
SBI	₹ 48.45 Lakh for 15 years	8.05%	₹ 46,439
HDFC	₹ 50.98 Lakh for 15 years	7.65%	₹ 47,695
ICICI Bank	₹ 46.71 Lakh for 15 years	8.35%	₹ 45,584
Axis Bank	₹ 44.57 Lakh for 15 years	8.75%	₹ 44,547
PNB Housing Finance	₹ 44.57 Lakh for 20 years	8.75%	₹ 39,388
IDBI Bank	₹ 48.15 Lakh for 15 years	8.10%	₹ 46,291
Indiabulls	₹ 33.03 Lakh for 10 years	9.99%	₹ 43,635

• As you can see in the above table, loan amount eligibility differs for different banks. Hence, it is extremely important to compare the eligibility terms and interest rates of different banks before choosing the bank to borrow from.
• Banks offering highest eligibility of ₹ 50.98 Lakh is HDFC.
• Minimum eligibility of ₹ 33.03 Lakh is offered by DHFL.
• EMI amount ranges from ₹ 39,388 to ₹ 47,695 at different interest rates offered by banks.

The steps to use MyLoanCare Mortgage Loan Eligibility calculator are mentioned below:

Step 1: Visit MyLoanCare Loan Against Property Calculator.

Step 2: Enter the details which includes name, monthly income, employer type and others.

Step 3: Click on the ‘CHECK ELIGIBILITY’ tab.

Step 4: You will receive an OTP on your mobile number, enter the OTP and click on ‘Verify’.

Step 5: Fill additional details related to property.

Step 6: The calculator will show all the LAP offers you are eligible for.

Bank	Loan Amount Eligibility for Max Tenure	Age of Eligible Borrower	Maximum Loan on Property Value
SBI Loan Against Property Eligibility	₹ 7.50 Cr for 15 years	18 to 70 years	Upto 80%
HDFC Loan Against Property Eligibility	₹ 5 Cr for 15 years	24 to 60 years	Upto 50%
ICICI Bank Loan Against Property Eligibility	₹ 7 Cr for 15 years	21 to 60 years	Upto 60%
Axis Bank Loan Against Property Eligibility	₹ 7 Cr for 15 years	24 to 60 years	Upto 80%
Citibank Loan Against Property Eligibility	₹ 5 Cr for 15 years	23 to 60 years	Upto 70%
PNB Housing Finance	₹ 5 Cr for 20 years	21 to 60 years	Upto 60%
LIC Housing Finance	₹ 5 Cr for 15 years	21 to 60 years	Upto 70%
Kotak Bank	₹ 3 Cr for 12 years	21 to 65 years	Upto 55%
Yes Bank	₹ 5 Cr for 15 years	21 to 60 years	Upto 70%
Bajaj Home Finance	₹ 4 Cr for 20 years	33 to 58 years	Upto 75%
IDFC First Bank	₹ 5 Cr for 15 years	21 to 60 years	Upto 80%
RBL Bank	₹ 10 Cr for 15 years	23 to 60 years	Upto %
Syndicate Bank	₹ 5 Cr for 10 years	21 to 60 years	Upto 60%
IDBI Bank	₹ 10 Cr for 15 years	22 to 60 years	Upto 65%
DCB Bank	₹ 10 Cr for 15 years	21 to 60 years	Upto 70%
HDFC Bank	₹ 5 Cr for 15 years	21 to 60 years	Upto 65%
South Indian Bank	₹ 15 Cr for 12 years	21 to 60 years	Upto 70%
Jammu And Kashmir Bank	₹ 1 Cr for 7 years	21 to 60 years	Upto 60%
Dhan Laxmi Bank	₹ 5 Cr for 15 years	21 to 60 years	Upto 65%
Andhra Bank	₹ 2 Cr for 10 years	21 to 65 years	Upto 50%
Union Bank of India	₹ 10 Cr for 12 years	18 to 60 years	Upto 50%
Lakshmi Vilas Bank	₹ 5 Cr for 10 years	21 to 60 years	Upto 60%
Indian Overseas Bank	₹ 1 Cr for 7 years	21 to 60 years	Upto 50%
PNB	₹ 5 Cr for 10 years	21 to 60 years	Upto 80%
Standard Chartered Bank	₹ 5 Cr for 15 years	21 to 60 years	Upto 70%
Karnataka Bank	₹ 1 Cr for 15 years	21 to 60 years	Upto 80%
Edelweiss	₹ 5 Cr for 15 years	21 to 60 years	Upto 60%
Piramal Housing Finance	₹ 5 Cr for 20 years	23 to 60 years	Upto 75%
Bank of India	₹ 5 Cr for 12 years	21 to 60 years	Upto 40%
United Bank of India	₹ 5 Cr for 7 years	21 to 60 years	Upto 60%
OBC	₹ 10 Cr for 10 years	21 to 60 years	Upto 60%
Indian Bank	₹ 2 Cr for 7 years	18 to 60 years	Upto 50%
Corporation Bank	₹ 5 Cr for 10 years	18 to 65 years	Upto 50%
India Shelters	₹ 1 Cr for 10 years	21 to 60 years	Upto %
Indiabulls	₹ 3 Cr for 10 years	23 to 65 years	Upto 65%
Karur Vysya Bank	₹ 5 Cr for 9 years	21 to 60 years	Upto 40%
Federal Bank	₹ 5 Cr for 10 years	21 to 60 years	Upto 50%
Cholamandalam	₹ 5 Cr for 15 years	21 to 65 years	Upto 70%
Canara Bank	₹ 10 Cr for 7 years	21 to 60 years	Upto 50%
Punjab and Sind Bank	₹ 5 Cr for 12 years	21 to 60 years	Upto 50%
IndusInd Bank	₹ 5 Cr for 15 years	21 to 60 years	Upto 65%
DBS Bank	₹ 3 Cr for 10 years	21 to 60 years	Upto 65%
Allahabad Bank	₹ 2 Cr for 9 years	21 to 70 years	Upto 50%
UCO Bank	₹ 5 Cr for 12 years	21 to 60 years	Upto 50%
HSBC Bank	₹ 10 Cr for 15 years	21 to 58 years	Upto 65%
Central Bank of India	₹ 10 Cr for 10 years	21 to 60 years	Upto 50%

Apply for longer loan tenure: Your Loan against property EMI depends upon the tenure of the loan. Higher the loan tenure, higher will be your loan amount eligibility. If your loan eligibility for a 10 year loan is ₹ 15 lakh, you may evaluate the option of taking 15 years loan to increase your loan amount eligibility. You can also check your loan eligibility with MyLoanCare Property Loan Calculator.

Prepay your existing loan completely: If you have an existing loan near to closure, it might help to pay back the loan to increase your monthly savings and enhance your loan eligibility.

Add any co-applicant (Spouse or parents): If you include your spouse or parents as loan co- applicant, then your overall loan eligibility will go up as more income is available to support loan repayment. Please ensure that the co-applicant is earning, has a strong credit track record and can produce credit and income proofs, as required.

Add Rental Income: Some banks are also open to consider your rental income as a part of your net income to calculate your loan eligibility. Hence, it is advisable to disclose and report your rental income if you want the highest loan amount.

Maintain good credit score: Before applying for loan against property, check out your CIBIL score. Look for errors, if any. Do not apply for a loan with various lenders to get a loan quickly. Pay all your credit card bills and loan EMI on time or you can also do advance payment to improve your CIBIL score and your eligibility for a loan.

Choose the property to be mortgaged wisely: Banks view residential property as the safest and hence, offer the highest LTV on such properties. If you have an option, always try to avail a loan against a residential property to get highest loan and lowest interest rate. Commercial property mortgage tend to get you lower loan amount eligibility and higher interest rate, as perceived risk is high. Only a few banks offer loan against industrial property and that too at lower LTV and higher interest rate.

Following documents are required to fulfil your eligibility for a mortgage loan:

• Identity Proof – PAN Card, Aadhar Card, Voter ID Card
• Address proof – passport, Aadhaar card, voter Id card, landline bill, registered rent agreement, driving license
• Income Proof- Bank statement, ITR forms if you are salaried
• Last 3 years ITR , profit and loss account, balance sheets certified/audited by a CA, if you are self employed
• Office address – ownership/ lease / rent agreement/ utility bill in case you mortgaged a commercial
• Past Sale Deeds Chain, Registered Sale Deed/ Conveyance/ Lease Deed
• Latest House Tax Return/ Receipt - Approved Building Plan from Municipal Corporation

✅What types of property can be accepted as security for getting loan against property?

The type of property that can be accepted as security to get loan against property are:

• Residential property and commercial property.
• Some banks also lend against industrial property in some areas.
• Banks can lend against self occupied property, rented out property and even vacant property. However, interest rates on loan against vacant property may be higher than those on self occupied property.
• Most banks would insist upon a clear and marketable title with a full property chain.
• Property offered as security must be located within municipal limits and must have been constructed as per the approved map plan.
• No other bank or individual should have any claim on the property.

✅Why does loan against property eligibility depend upon income?

The loan against property depends on income due to following reasons:

• Loan servicing capability refers to the EMI you are capable of paying after meeting living expenses based on your standard of living and income.
• The maximum EMI is limited to the surplus available after meeting essential and lifestyle expenses like those on food, travel, entertainment, family, clothing, medical treatment and similar such expenses.
• For the purpose of determining loan eligibility, most banks consider maximum EMI paying capacity as 60% to 70% of the net monthly income after taxes and deductions.

✅Is CIBIL score required for loan against property?

Loan against property is a secured loan, as you submit your property as collateral. In case of a secured loan, credit score has a lower role to play as compared to its role in an unsecured loan. However, the credit score is still an important parameter that is required to get your loan application accepted.

✅What types of property are not eligible as security for loan against property?

The type of properties against which you can not avail mortgage loan are as following:

• Banks do not give loans against agricultural land. Only crop loans can be availed against agricultural land.
• Vacant or unused land is not eligible to be offered as a security for availing loan.
• Buildings and property located in gram panchayat areas, lal dora areas and unauthorized areas are not accepted as security by most banks.
• Property bought on power of attorney (PoA) cannot be offered as security for loans in most parts of India.
• Property with broken chain in the title documents is typically not accepted.
• Very small properties (less than 600 sq ft in size) are mostly not eligible as security.

✅How do banks value the property when deciding eligibility for the loan against it?

Bank decides the loan against property eligibility by following these steps:

• An independent valuer appointed by the bank would visit the property, take its measurements and check whether the construction is as per the approved map plan or not.
• The valuers would base the value on current prevalent property prices in the locality, area of the property in square meters or square feet, age of the property and its condition.
• The value is not related to the circle rate or ready reckoner rates as these may not always be in line with the market rates.
• For higher ticket size loans (₹ 1 Cr and above), banks may get valuation reports from two independent valuers and take an average of the two to arrive at a value for the purpose of calculating maximum loan eligibility based on LTV.

✅How does eligibility calculator calculate eligibility in case of businessmen?

The loan against property eligibility calculator calculates the eligibility for businessmen in the following ways:

• Income of business concerns such as companies, partnerships and proprietorships is taken as eligible income. You can also add non-cash expenses such as depreciation to arrive at eligible income and increase loan amount eligibility.
• The business must be registered and at least three years of income tax returns must be available.
• It is possible to add income from other sources like rent and interest to help increase eligibility.

✅What are the various types of income that can be added to calculate loan against property eligibility?

You can add the following incomes to calculate the loan against property eligibility:

• Any regular income that is supported by documents is eligible to be considered for the purpose of determining eligibility using the loan against property calculator.
• Examples include income from salary, business, profession, interest, teaching, royalty, rent and fees. In some cases, bonuses and sales incentives may also be added to income. However, reimbursements, income from shares, capital gains and undocumented income cannot be considered.
• The income must be supported by income tax return and Form16 or Form 16A.

✅How much can you borrow against property?

The maximum amount you can insure against the property is based on Loan to value ratio offered by the bank. Generally, LTV ranges between 60% -70%. Further, the maximum amount with a LAP that you can avail depends on your employment status. Self-employed can avail a Loan against property of up to ₹ 3.5 crore while the maximum loan limit for salaried is ₹ 1 crore.

✅How much property loan can I get on my salary?

The loan amount on LAP you can avail is dependent upon CIBIL, salary, current obligations etc. Banks generally offer loans against property 60 times your salary. However, banks do not consider gross salary for calculation rather net salary is used for deriving the loan amount. Net salary = Gross salary - (EPF+ TDS+ professional tax etc). So let’s say your salary is ₹ 60,000 then you are eligible for a maximum loan amount of ₹ 36,00,000.

✅How much loan against property can I get on ₹ 40,000 salary?

Loan amount on LAP is based on multiple indicators like CIBIL, salary, current obligations etc. The maximum amount you can get in the form of a loan is 60 times your salary. So if your net salary is ₹ 40,000 you can get a maximum loan amount of ₹ 24,00,000.

✅How much loan against property can I get on ₹ 75,000 salary?

As a rule of thumb, salaried individuals are eligible for loan against property maximum up to 60 times their net monthly income. However, banks do not consider gross salary for calculation rather net salary is used for deriving the loan amount. Net salary = Gross salary - (EPF+ TDS + professional tax etc). So if your net salary is ₹75,000 you can get a maximum loan amount of ₹ 45,00,000.