LIC Loan Against Property Feb 2020

LIC Housing Finance Loan Against Property in India

LIC offers loan against property to people who require funds to meet their business as well as personal needs against the mortgage of their existing property. Taking a loan from LIC has the following benefits:

• Attractive interest rates
• Long tenure with low EMIs
• Loan for both residential and commercial properties

LIC Housing Finance Mortgage Loan	Interest Rates
Griha Vikas	9.50%
LAP - Commercial	9.50%

Griha Vikas
Loan Amount	Rate
Upto ₹ 50 Lakh	9.50%
₹ 50 Lakh - ₹ 1,00,00,000	9.50%
₹ 1 Cr - ₹ 3,00,00,000	9.50%
Above ₹ 3 Cr	9.50%

• Loan amount: Property loan rates in LIC depends upon the loan amount you apply for. You can get minimum loan of ₹ 20 Lakh from LIC.
• Your Net Monthly Income: Income helps you in identifying your rate of interest. Higher the income, higher will be your repayment capacity which will increase your eligibility for higher loan amount.
• Type of loan opted for: LIC offers differential rates for different profile of customers and also fixed and floating rate schemes. Loan against property interest rates may be higher or lower for special loan product.
• Type of property: Typically, loan against prime residential properties are easier to get and can be availed at the lowest rates compared to loan against commercial and industry properties.
• Your profession: LIC may charge a higher interest rate on a mortgage loan by a salaried as compared to a self-employed professional or a businessman. A self employed professional or businessman is expected to deploy loan proceeds for productive purposes in his occupation or business compared to salaried who will most likely take a mortgage loan for his personal purposes.

Interest Rate and its impact on LIC Loan Against Property Eligibility

LIC has detailed criteria to determine a potential borrower’s eligibility for mortgage loans. Some of the key criteria are:

Eligibility Criteria	Details
Age	21 to 60 years
Minimum Income	₹ 35,000
Loan Amount	₹ 20 Lakh to ₹ 5 Cr
Minimum years of business existence	2 years
Minimum work experience	3 years
Minimum Credit Score	650 and above
Loan to Value Ratio	Upto 70%
FOIR (Fixed Obligations to Income Ratio)	0.65

• Age: Age is one of the important factors to examine your eligibility. LIC Housing Finance offers loan to salaried and self employed from the age of 21 years. Any person taking loan at the age of 21, can get loan of up to 15 years, thus reducing servicing burden on his existing income and hence, improving his loan amount eligibility.
• Income: Property loan is mostly taken by self employed individuals primarily to meet their business requirements. However, in order to increase the loan amount you may club the income of family members like your spouse, parents, children and siblings.
• Business Stability: Self employed person should be in business for a minimum of 3 years during which the business should be profitable.LIC Housing Finance will ask for ITRs of 2 years to consider you as eligible for LAP.
• CIBIL Score: Past CIBIL history and repayment record of existing loans and credit cards has adverse impact on your loan eligibility. If you have a poor repayment record, then you may find it difficult to get a loan. A regular repayment record not only improves your chances of getting a loan, but also increases your loan eligibility. LIC Housing Finance grants loan to borrowers with a CIBIL score of 650 and above.
• Loan Amount: LIC Housing Finance gives you an amount ranging from ₹ 20 Lakh to ₹ 5 Cr. To improve chances of approval, apply for a loan amount that you can comfortably service.
• Property Value: The value of the property to be mortgaged is used to calculate maximum loan eligibility based on the maximum permissible LTV ratio which can range upto 70% depending on the type of property. LIC Housing Finance will conduct a detailed property assessment to establish that all legal titles are in place, assess the market value of the property, and its sale ability. LTV is calculated based on the estimated fair market value or registered value, whichever is lower.
• Fixed Obligations to Income Ratio (FOIR): The bank will also calculate the proportion of your fixed obligations to your income to calculate the Fixed Obligations to Income Ratio, known as FOIR. Fixed obligations include estimated average monthly expenses and EMIs you are paying on other existing loans. Minimum FOIR to be eligible for a LIC Housing Finance mortgage loan is 0.65.

LIC Housing Finance Loan Eligibility Calculator

LIC Housing Finance Property loan Eligibility is the amount of loan you can avail based on an assessment of your repayment capacity as well as the value of property. You can use eligibility calculator to get a fairly accurate estimate of your potential eligibility subject to the information provided by you.

LIC Housing Finance Mortgage Loan EMI and Interest Calculator

You can also use online LIC Housing Finance Loan against property EMI Calculator to calculate loan EMIs. EMI is a fixed amount that you are required to pay each month towards the repayment of your loan till the end of tenure

• EMI calculator of LIC Housing Finance helps you to calculate your monthly EMI at different rate of interest and also check and compare lowest EMI per lakh on LAP.
• Higher the loan amount, higher the EMI. You can compare the estimated EMI with your monthly repayment capacity to decide on a level of EMI you can comfortably service without creating financial burden.
• Loan tenure matters equally as higher loan tenure reduces your EMI
• Another factor which affects your EMI is interest rate on the loan. Higher the interest rate, higher will be the EMI. However, your cumulative interest outgo will be significantly high in a longer tenure loan compared to a short tenure loan. Loan against property interest rate comparison of different banks will allow you to choose the cheapest loan and hence, improve your eligibility

What are the benefits of calculating LIC Housing Finance Mortgage loan EMI?

• EMI calculator helps you to calculate your monthly EMI at different rate of interest
• LIC Housing Finance Mortgage loan EMI calculator helps you to know your capacity to repay the loan after maintaining your standard of living
• Getting an EMI estimate will help you ascertain the monthly EMI you can comfortably service, thus allowing you to choose the right combination of loan amount and loan tenure.

In addition to interest rates, property loan also carry some other charges which include:

• Foreclosure Charges - These charges are to be paid in case you want to repay your entire loan amount before the end of tenure period. LIC Housing Finance allows prepayment of loan against property with Nil prepayment charges.
• Processing Fee - LIC Housing Finance charges a processing fee of 0.25% loan amount.
• Other Charges - Bank also charges technical and legal charges which are explained to the customer during the loan process.

Transfer of LAP from another bank to LIC Housing Finance

LIC Housing Finance offers mortgage loan balance transfer from another bank. This is subject to your meeting other eligibility criteria of LIC Housing Finance.

You can avail additional top-up loan against property from LIC Housing Finance, subject to your eligibility.

LIC Housing Finance Loan against property documents required

• Filled up loan application form
• 2 Passport Size Photo
• ITR of last 2 years
• Identity Proof - Passport/ Driving License/ Voter ID/ PAN
• Residential Address Proof - Leave and License/ Registered Rent Agreement/ Utility Bill (up to 3 months old), Passport
• Business proof such as VAT/ service tax registration, incorporation details in case of companies, business address proof, profit and loss account and balance sheets certified by CA, copy of partnership deed and proof of business existence and business profile

• Filled up loan application form
• 2 Passport Size Photo
• ITR of last 2 years
• Identity Proof - Passport/ Driving License/ Voter ID/ PAN
• Residential Address Proof - Leave and License/ Registered Rent Agreement/ Utility Bill (up to 3 months old), Passport
• Income Documents – 6 months payslip, 2 years Form 16, 6 months bank statement showing salary credit and any EMI debit

• 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

Frequently Asked Questions