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Tata Capital > Blog > Loan on Property > Step By Step Loan Against Property Process Explained

Loan on Property

Step By Step Loan Against Property Process Explained

Step By Step Loan Against Property Process Explained

Loan Against Property (LAP) is a type of secured loan that allows one to avail credit by mortgaging an owned land or property, be it residential or commercial as well as self-occupied or given on rent. A LAP can be used for purposes such as meeting medical emergencies, funding children’s higher studies, marriage expenses, or even starting up a business or financing a much-awaited international or domestic trip.

Under a loan against property process, the lender evaluates the current market value of the pledged property and disburses a loan amount equivalent to the same to enable one to get the required credit requirements.

Key features of Loan Against Property

Following are some of the key features of the loan against property offered by Tata Capital –

  • Loan Amount – One can get a loan of as low as low as Rs 5 lakhs and as high as Rs 10 crores by mortgaging their property with Tata Capital.
  • Loan Tenure – A loan against property can be availed for 12 – 240 months.
  • Rate of Interest – Tata Capital offers Loan Against Property at affordable interest rates.
  • EMI Options – At Tata Capital, one can choose between two EMI options, namely Standard EMI Plan and Step Up Flexi EMI Plan. Under the Standard EMI Plan, one re-pays the loan in the traditional manner consisting of principal amount and consistent interest amounts. However, if one chooses the Step-Up Flexi EMI Plan, then they can pay lower EMIs at the beginning of the loan tenure and higher EMIs later.

Eligibility criteria for Loan Against Property

Before applying, it’s important to understand the basic requirements lenders look at to assess your repayment ability and the value of the property offered as security:

  1. Applicant type: Salaried individuals, self-employed professionals, business owners, and MSMEs can apply.
  1. Age limit: Typically 25–65 years for salaried applicants; up to 70 for self-employed, at loan maturity.
  1. Property ownership: Applicant must be the legal owner or co-owner of a residential or commercial property.
  1. Property type: Property should be free from legal disputes and approved by local authorities.
  1. Income stability: Regular and verifiable income to support EMI repayment capacity.
  1. Credit score: Generally 650 or above; higher scores improve approval chances and terms.
  1. Employment/Business vintage: Minimum 2–3 years of work or business continuity is preferred.
  1. Loan-to-Value (LTV): Usually up to 50–70% of the property’s market value.
  1. Existing liabilities: Lower existing EMIs improve eligibility.
  1. Documentation: KYC, income proof, bank statements, and property papers are mandatory.

Loan Against Property process step-by-step

One can secure a credit with Tata Capital by following this process for loan against property –

Step 1: Check loan qualification with our LAP eligibility calculator

The first and foremost step in the LAP loan process is an assessment of one’s eligibility for the credit. For this, borrowers can use the LAP eligibility calculator available on our website. To use our LAP eligibility calculator, one needs to provide details like their monthly income and expense, city of residence, date of birth, existing EMIs, and the tenure for which one wishes to take the loan.

Step 2: Choose loan amount and tenure

As a next step, one needs to select the amount of loan which they wish to avail of by pledging their property and the tenure for the credit.

Step 3: Submit loan application and required documents

After choosing the loan amount and tenure, one needs to fill out our loan application form with details like Name, Date of Birth, PAN, Property Type, Reason for LAP, Property Value, and Required Loan Amount. Along with the submitted form, one must provide the following documents for LAP –

  1. An ID Proof such as Aadhaar Card, PAN card, Passport, etc.
  1. An Address Proof, such as a bank passbook or a utility bill
  1. Income Proof such as ITR, Form 16, etc.
  1. Last Last 12 months’ bank statement
  1. A passport-sized photograph

Step 4: Get the loan mount in bank

Once the completed loan application form and the required documents are submitted, one of our loan approval officers evaluates the applicate and approves the disbursal of the credit in the bank account of the borrower if all the details are complete and the borrower is eligible for the credit.

How Loan Against Property works: Application to disbursal

Understanding how Loan Against Property works can help you plan your finances better and avoid delays. The procedure for Loan Against Property usually begins with checking eligibility based on income, age, credit score, and property ownership. Once you know how to take Loan Against Property, you submit an application along with KYC documents, income proof, and property papers.

As part of what is the process of Loan Against Property, the lender conducts a credit assessment to evaluate repayment capacity and a legal and technical verification of the property. This step ensures the asset is dispute-free and suitable as collateral. After successful checks, the lender issues a loan sanction letter detailing the approved amount, interest rate, tenure, and terms.

The LAP loan process then moves to documentation and signing of the loan agreement. Once all formalities are completed, the loan amount is disbursed, either in full or in stages, directly to your bank account. Repayment starts through monthly EMIs over the agreed tenure.


Also, read – Top 10 home loan benefits you should know in India

Checklist: Documents required for LAP loan process

Preparing your documents in advance helps streamline the LAP loan application and approval process:

  • Identity proof: Aadhaar card, PAN card, passport, or voter ID.
  • Address proof: Utility bills, Aadhaar, passport, or rental agreement.
  • Income proof (Salaried): Latest salary slips, Form 16, and bank statements.
  • Income proof (Self-employed): IT returns, audited financials, and bank statements.
  • Employment or business proof: Employment letter or business registration documents.
  • Property title deed: Sale deed or conveyance deed proving ownership.
  • Property documents: Approved building plan, completion certificate, and tax receipts.
  • Bank statements: Last 6–12 months for income and EMI assessment.
  • Photographs: Recent passport-size photographs of applicants.
  • Existing loan details: Statements of ongoing loans, if applicable.

Loan against property processing fees & timeline

At Tata Capital, we levy a loan against property processing fee for the administrative expenses incurred while processing loan applications. For, Residential and Commercial properties, loan against property processing fee stand at 1% of the loan amount plus the GST. Whereas the LAP processing fee for all other properties stands at 1.25% of the loan amount along with the GST. For mint loans also, the LAP processing fee is 1.25% of the loan amount and the GST.

For detailed information on Tata Capital’s LAP fees and charges, please click here.

Also, read –   Understanding home loan settlement 

What impacts fast approval in the LAP process?

Several factors influence how quickly a Loan Against Property application moves from review to approval, especially when documentation and eligibility align well:

  • Complete documentation: Submitting all papers correctly supports a smoother procedure for loan against property.
  • Credit profile: A good credit score improves timelines within the LAP loan process.
  • Income stability: Consistent income makes it easier to assess eligibility.
  • Property clarity: Dispute-free property speeds up legal and technical checks.
  • Eligibility check: Meeting the lender’s criteria early helps in the LAP loan process.
  • Accurate application: Knowing how to take loan against property reduces follow-ups and delays.
  • Quick responses: Prompt replies to lender queries help accelerate approval and disbursal.

Tips for quick Loan Against Property approval

A few smart steps taken early can significantly improve your chances of faster approval and smoother processing:

  • Check eligibility early: Review age, income, and property criteria before applying.
  • Maintain a good credit score: Higher scores help speed up approval and improve terms.
  • Prepare documents in advance: Keep KYC, income, and property papers ready.
  • Ensure clear property titles: Dispute-free ownership reduces legal verification time.
  • Limit existing liabilities: Lower EMIs improve repayment assessment.
  • Apply with accurate details: Error-free applications reduce back-and-forth.
  • Respond promptly: Quick replies to lender queries help avoid unnecessary delays.

Online Vs Offline LAP process: What’s the difference?

Choosing between an online or offline approach depends on your comfort level, urgency, and need for personal assistance:

AspectOnline LAP processOffline LAP process
ApplicationSubmitted digitally through lender websitesSubmitted in person at a branch
DocumentationUploaded onlinePhysical copies required
Processing speedUsually faster due to automationMay take longer due to manual handling
ConvenienceApply anytime, anywhereRequires branch visits
TrackingReal-time status updates availableUpdates via calls or branch follow-ups
VerificationMostly digital with limited physical checksLargely manual verification
SuitabilityIdeal for quick, tech-savvy applicantsSuitable for those preferring in-person assistance

Common mistakes to avoid in Loan Against Property process

Avoiding a few common errors can make your Loan Against Property journey smoother and prevent unnecessary delays or rejections:

  • Skipping eligibility checks: Applying without confirming age, income, or credit requirements.
  • Incomplete documentation: Missing or outdated property and income papers.
  • Ignoring credit score: Overlooking low scores that can slow approval.
  • Unclear property titles: Legal disputes delaying verification.
  • Underestimating liabilities: High existing EMIs affecting repayment capacity.
  • Incorrect application details: Errors leading to repeated follow-ups.
  • Delayed responses: Slow replies to lender queries extending processing time.

Also, read – How To Start A Real Estate Business In India? 


Conclusion

A Loan Against Property can be a good form of availing credit in terms of emergency as it enables a property owner to get the required finances without losing the ownership right of their property. At Tata Capital, we provide quick and easy processing of loans against property to help meet urgent fund requirements, along with a hybrid term loan facility to keep enough liquidity available to our borrowers. We also accept a wide range of collaterals to cater to borrowers with different types of properties and provide a pre-qualified loan top-up to help them further meet their financial obligations easily and instantly.

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FAQs

What is the Loan Against Property process in India?

The procedure for Loan Against Property includes eligibility check, application, credit assessment, property verification, sanction, documentation, and disbursal, explaining how Loan Against Property works end to end.

How long does the LAP loan approval process take?

 

The LAP loan process timeline depends on documentation completeness, credit profile, and property verification.

What documents are required for Loan Against Property in India?

 

If you’re wondering how to take Loan Against Property, submit KYC, income proof, bank statements, and property papers as part of the standard procedure for Loan Against Property.

Can NRIs apply for a Loan Against Property in India?

 

Yes, NRIs can apply if they own eligible property in India and meet income criteria, following the same LAP loan process with additional NRI-specific documentation.

How much loan can I get against my property value?

 

It differs from different lenders and the property’s market value, depending on eligibility and how Loan Against Property works for your income and credit profile.

What factors speed up or delay the Loan Against Property process?

 

Clear property titles, good credit scores, and complete documents speed up the process, while discrepancies and delays in responses slow the LAP loan process.

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