The term Loan against Property refers to a mortgage loan, which you can avail by pledging your property as security or collateral. Such a loan can be availed by an individual, or a business, against existing property as collateral. The mortgage property could be your home, land, industrial building, shop, or any other kind of landed estate. Most banks and NBFCs offer loans against property as multi-purpose secured loans. You can obtain funds of up to 60% to 80% of the market value of your property.

Loans against property typically offered at lower interest rates as compared to personal loans or business loans and disbursed within a reasonable period. The fact that you mortgage your property does not mean that you don’t own your property. In fact, you may continue to use the mortgaged property for residential or commercial purposes. When you apply for a loan against property, you are required to meet several requirements, including minimum credit scores, and down payments. Your application then goes through a rigorous screen process before approval and disbursal.