Loans against property or property loans are a popular financing option in India. Property loans are secured by a property – residential or commercial – and hence, are secured in nature. Therefore, lenders offer these loans at nominal interest rates. Further, property loans come with zero end-use restrictions. Borrowers can use the funds availed of under these loans to take care of both personal and professional needs. These reasons are primarily responsible for the growing popularity of property loans. However, since loans against property require borrowers to pledge their property as collateral, borrowers must avail of these loans after much deliberation and borrow a loan amount they are comfortable repaying.

In this article, we walk our readers through the loan against property application process. Here’s what the loan against property loan application process entails.

1. Research Your Options: If you want to avail loan against property, the first thing you must do is research your options. There is no dearth of lenders to choose from, so one must pick smartly. Choose a lender who is reliable and trustworthy and has a good reputation. Reach out to at least a few different lenders and see what each of them has to offer you. In the end, choose to go with the lender offering you the best deal.
2. Check Your Chosen Lender’s Qualifying Criteria for a Loan Against Property: You will be able to avail yourself of a loan against property only if you meet your lender’s qualifying criteria. If you do not meet the qualifying criteria, you will get rejected. So, apply only if you qualify for a loan.
3. Apply for a Loan: The next step in the process is applying for a loan. Borrowers can apply for a loan against property both online and offline. However, given people’s hectic work schedules, most people prefer to apply for a loan online. If you are applying for a property loan online, please go through the list of documents you will need to submit to avail yourself of the loan. You will find this list on your lender’s website. Most lenders ask for KYC, address and income proof documents as well as all property documents. Keep the soft copies of all these documents ready with you.
4. Receive Approval and an Offer Letter: After you have submitted the form and all the required documents, your lender will verify all the documents and information provided by you. If they are satisfied, they will extend you a loan offer. The loan offer letter will contain important details, such as the loan amount you are being offered, the interest rate that your lender is willing to offer you, interest type, loan tenor, etc. If you are happy with the terms and conditions mentioned in the loan offer letter, you can go ahead and accept the letter. If some of the terms and conditions leave you concerned, you can discuss them with your lender and open another round of negotiations.
5. Sign the Final Loan Agreement: Once you have sent a signed copy of the loan offer letter, your lender will hire an expert to physically check the property. If all is good, you will be sent a final loan against the property agreement. You will have to visit your lender’s office to sign this agreement.
6. Receive Loan Amount in Your Bank Account: Once all the formalities are done, you will receive the loan amount in your bank account. You will then begin paying your EMIs to your lender.

Also have a look at our article on How to Get the Best Deals on Property Loan Interest Rates?