Loan Against Property
A Loan Against Property (LAP) is a type of loan that uses a property as collateral to secure the loan. It is a secured loan that allows you to borrow a lump sum amount by mortgaging your property. The property can be a house, commercial building, or land.
Here are some key features of a Loan Against Property:
- Loan amount: Up to 60-70% of the property's value
- Interest rate: Lower than personal loans, but higher than home loans
- Repayment tenure: 5-15 years
- Collateral: Property documents are held by the lender until loan repayment
LAPs are often used for:
- Business expansion
- Debt consolidation
- Large expenses (e.g., education, wedding)
- Emergency funding
- Lower interest rates
- Longer repayment tenure
