Loans against property are a type of secured loan. These are loans that people avail themselves of by pledging a residential or commercial property or land as security. Since the loan is backed by collateral, which the lender can sell for the recovery of the loan money in case of a loan default, the risk for lenders is quite low in the case of these loans. Loans against property interest rates, therefore, tend to be low. Moreover, lenders give borrowers a comfortably long repayment period of 15 to 20 years to simplify the burden of loan repayment. Loans against property are one of the only few loan options that give borrowers access to substantial funds while also allowing them to use the loan money however they like. 

These factors have significantly impacted the demand for property loans positively. However, with increasing demand for property loans has also increased lender scrutiny. Today, lenders assess each loan against property application carefully before approving it. The eligibility criteria for property loans have become more refined over the years and only individuals who meet these qualifying criteria get approved for a loan. Here, we look at the eligibility criteria for property loans. 

Eligibility Criteria for Property Loans 

1. The applicant must be a residing citizen of India. Most lenders sanction loans against property to Indian citizens only but there are a few that sanction loans to NRIs and foreign nationals also. However, such lenders are not many. 

2. All lenders have minimum and maximum age requirements. Most lenders set 25 as the minimum age and 85 as the maximum age. One must always keep in mind that the maximum age is always the age at the time of loan maturity and not at the time of applying for the loan. Age requirements vary from lender to lender. Therefore, applicants must talk to a representative of their preferred lender and get clarity on their age requirements beforehand.

3. Your CIBIL score will play a crucial role in determining your home loan eligibility. Individuals with a high CIBIL score are people with high creditworthiness and repayment capacity. Such individuals are less likely to default on loan repayment and therefore, applications from individuals with a high CIBIL score get approved quickly. On the other hand, individuals with a low CIBIL score find it difficult to get approved for a loan. To be eligible for a home loan in India, borrowers must have a CIBIL score of at least 725. The closer one’s CIBIL score is to 900, the better their chances of loan approval. All loan against property applicants must check their CIBIL score before applying for a loan against property and proceed with the application process only if they meet the minimum CIBIL score requirements. 

4. Lastly, income and job stability matter too. Individuals with a stable income and job find it easier to get approved for a loan. On the other hand, individuals with unstable incomes and jobs do not always get approved quickly. 

These are the basic loans against property eligibility requirements. However, eligibility requirements vary from lender to lender. So, one must talk to their lender and get clarifications on any additional loans against property eligibility requirements they may have before beginning the loan application process.