Mortgage Loan or LAP


Mortgage Loan or LAP (Loan Against Property) are term loans provided by banks and financial institutions, which are secured by a collateral security usually in the form of a property. The funds from a Loan Against Property can be used for creating long-term assets or for creating short assets based on the needs of the business. The collateral security in the form of a real estate property offered for the LAP plays an important role in the amount of loan sanctioned and terms. Banks and financial institutions prefer commercial and residential property with building as collateral security for the loan. Loan Against Property is usually sanctioned for a term of 3 to 7 years based on the borrower’s profile. The interest rate on Loan Against Property is usually higher than that of term loan facilities or working capital facilities.

Adroit Corporation can help your business apply and obtain sanction of Loan Against Property from banks. Once we obtain an understanding or your business or proposed business, our Financial Experts will then advice you suitably on the proposed quantum of loan against property, type of facilities and schemes available. Adroit corporation can also help you prepare a project report, apply to banks and obtain sanction of loans for your business.

 

FAQ


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What is Loan Against Property?
Loan Against Property is loans sanctioned by the banks based on the collateral security provided in the form of real-estate property. Banks will lend funds based on the market value of the property and the borrowers credit profile.
What Property will be accepted as collateral Security?
Banks prefer to lend against commercial or residential property in cities or town with a building as collateral security. The title of the property has to be clean and there should be no other facilities availed against the same property
What is tenure of loan against property ?
Loan against property can have a tenure of 3 to 7 years based on the borrowers profile, end use of funds and the collateral security offered. The tenure of the loan will be determined on a case-to-case basis.
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How much loan will be sanctioned ?
The value of the collateral security offered plays an important role in the quantum of loan sanctioned. Banks typically sanction upto 70% of the market value of the collateral security offered.
What is the market value of property?
The market value of the property is an estimated value at which the property can be sold on a fair value basis on the date of the valuation. The Banks Valuer or Bank Panel Valuer will determine this value based on valuation methodology adopted by the bank
What other factors are considered while sanctioning LAP?
The other major factor, which is considered while sanctioning a Loan Against Property, is the cash flow of the business. Banks typically ensure that the cash flow in the business would be sufficient to service the debt obligations of the business.
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