The Top Things About Loan Against Property You Must Know in 2021

A loan against property or mortgage is one of the most flexible loans people avail of during a financial emergency or meet specific obligations.

The most common uses of mortgage loans are a medical emergency and business debt consolidation. Besides this, people also use the loan amount to buy or renovate a property, purchase motor vehicles, sponsor a travel or wedding, etc.

The following sections contain all information you need about loans against the property before applying for one.

The Top Things About Loan Against Property You Must Know in 2021

1. Simple Application and Quick Approval -

Since a loan against property is a collateral-based loan, lenders usually approve the loan in no time. The application process is as seamless as the approval. Lenders like PNB Housing provide an online application facility. You can visit the lender's website and apply online to save your time and ensure faster approval.

2. Pocket-Friendly Interest Rates -

The loan against property interest rate is one of the lowest among loans. The effective rate depends on the borrower's monthly income, credit score, nature of employment, and property valuation. The floating rate of interest is presently hovering between 9.50% and 11%. The lowest loan against property interest rate is reserved for borrowers with a credit score of 800 and above.

3. One Loan Multiple Purposes -

Unlike other loans, a loan against property has universal applicability. It does not matter why you need the loan amount; as long as you have a valid, legal purpose, you can apply for the loan. For example, you can treat a loan against property as a medical loan, travel loan, education loan, home loan, auto loan, personal loan, and whatnot.

4. Extended Repayment Term -

While many Indian lenders provide a repayment term of up to fifteen (15) years, some lenders, such as PNB Housing, offer up to twenty (20) years. The EMI usually combines the principal and interest. You can pay the EMI through post-dated cheques or Electronic Clearance System.

5. Relaxed Eligibility Criteria -

Besides low loans against property interest rates, another feature that draws borrowers is the no-frills eligibility criteria. Any Indian salaried or self-employed professional or non-professional between 21 and 60 years can apply for a loan against property. While some lenders do not accept applications from borrowers with a low credit score, others increase interest rates to minimize risks.

6. Simple Documentation -

You need to submit around seven to eight documents to apply for a loan against a property. The documents include age and address proof, income proof and statement, bank account statement, Income Tax certificates, one passport-size photograph, and property documents. Your lender may also charge a processing fee to evaluate your application and grant you the loan.

7. High Loan Amount -

The loan amount against a property usually depends on the borrower's income and property valuation. If your income is high and the property is in a prime locality, you can expect a loan amount up to 60% of the property's market value. Moreover, a freehold self-occupied property usually gets more focus than a rented property.


Choosing the best lender is crucial when you want to explore all features of a loan against property. Moreover, the best lender offers many services, such as doorstep service, paid insurance, etc., to make the deal even sweeter. Hence, if you have a cherished dream to fulfill, now is the best time to apply for a mortgage loan and make it real.

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