A loan against property or LAP is a loan sanctioned against property as collateral. The loan amount is decided by the lender depending upon the market value of the property, and generally falls around 70% of the value of the property. It comes under the category of secured loans, thus serves many benefits, and can easily be availed by both individuals and businesses to address essential life goals such as higher education, marriage, construction of a house, business expansion, product development, and so on. There are many benefits of taking a loan against property:

Tax Benefits

  • Under Section 31 of the Income Tax Act, tax benefits can be availed on the interest amount for a loan against property
  • Under Section 24 of the Income Tax Act, tax benefits up to Rs. 2 lakhs can be availed on income tax if the loan against property is taken to build a new house. 

Flexible Loan Amount

The loan amount one gets through a loan against property depends upon the market price of the property and could lead up to Rs. 5 crores. It is a hassle-free way to get a bigger amount for the property. 

Competitive Interest Rates

Since loan against property is a secured loan, the interest rates are comparatively lower for the borrower, resulting in lower EMIs and reduced overall financial burden. 

Longer Loan Tenure

Loan against property normally comes with flexible repayment tenure going up to 15 years in comparison to a personal loan, which generally goes for 5 to 7 years. This reduces the financial pressure on the borrower. 

Different Property Options & Optimal Property Usage

To get a loan against property, you can use various types of properties like self-occupied house, commercial property, residential property or a piece of land. This flexibility not only makes taking a loan easier but also helps you utilize a property efficiently. Also, the borrower continues to own and use the property while availing funds against it. 

Easy Approval Process

Given the availability of security (collateral), a loan against property is easy to get compared to other unsecured loans. The documentation requirements are also minimal with some financial institutions providing doorstep facilities as well. 

Flexible Loan Amount Usage

Loan amount availed through a loan against property is fit for all monetary needs like home renovation, marriage, higher education, home construction, medical expenses and so on. 

No Pre-Closure Charges

The pre-payment towards a loan against property is generally not charged or penalized by the lender. This makes closing one’s loan against property easier and hassle-free. 

High Eligibility

Differences in eligibility exist for individuals and businesses. However, the parameters used for both are easy to meet like minimum age and income, credit history, financial stability, etc. 

Loan against property in India serves as an easy option to finance life goals for both individuals and businesses. It is a convenient way to get flexible loan amounts with easier interest rates, lower EMI’s, high repayment tenures and easy eligibility. The financial burden on the borrower is lower and allows the borrower to put his property to constructive use. 

Looking at converting your property into a source of funds? Visit your nearest Tata Capital branch today to explore loans against property!

To know more about Terms & Conditions, click here.


This communication is provided for general information only, without regard to any specific objectives, financial situations and needs of any particular person. This communication does not constitute an offer or invitation to avail services and no part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. Nothing in this communication should be considered as an investment or financial advice, nor should this communication be construed as an advice to buy or sell or as a solicitation to buy or sell the securities if any referred to herein. The intent of this communication is not recommendatory in nature. This communication is being supplied to you solely for your information and the same should not be reproduced, redistributed or passed on, directly or indirectly, to any other person, or published or copied, in whole or in part, for any purpose whatsoever.