With so many loan options offered by lenders in India, it can sometimes become difficult for you to choose the right loan.
If there is one loan which serves all purposes, it is a loan against property or LAP loan. Unlike many other loan types, the loan against property eligibility is absolutely straightforward.
Here are the top-5 factors that determine the loan against property eligibility:
Credit Score
If you avail a loan, lenders specify that the borrower's credit score must be above 750, as it often indicates a stable history of paying loan EMIs. However, when you avail a LAP loan, most lenders, like PNB Housing Finance, do not specify a minimum credit score. Hence, you can apply for a LAP loan even when your credit score is zero.
Income
Your income should be consistent. The higher your income, the lower LAP loan interest rates you can expect. It also pays well if you have a full-time job history of at least two years or business experience of three years.
Age
Generally, the age of the borrower must be between 21 and 60. However, your loan against property eligibility will be higher when you are young. The nearer you get to your retirement age, the more interest the LAP loan will charge.
Loan Term
The loan term may also play a role in determining the loan against property eligibility. If you are young, you can get a loan term of up to twenty years. However, if your age is 55, you cannot opt for a longer loan term.
Property Documents
As the loan is sanctioned based on your property papers, you should submit relevant papers sought by the lender. The required documents may include title deed, building plan, transfer of ownership, etc. Also, the mortgaged property should be free from legal disputes.
Conclusion
Besides the factors mentioned above, you need to be a citizen of India to avail a LAP loan.
