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Loan Against Property (LAP)

The Loan against Property (LAP) is a secured loan offered to individuals and households. The borrower must own property to be used as collateral. LAP is designed to provide loans for longer tenure which reduces the monthly EMI burden on the borrower while increasing the overall financing. With longer repayment periods, borrowers can spread out their payments over a more manageable timeframe, alleviating the immediate financial strain associated with loan repayment.

The collateralization of the loan with property makes LAP accessible to individuals having informal income sources or irregular income streams. LAP can be extended for –

  • Business Use
  • Personal Use

Eligible customers or households to have their own house with minimum monthly income of Rs 20k. The minimum age of the eligible borrower is 21 while the maximum age by the maturity of the loan is at 60 years. LAP will be extended mainly to-

  • Salaried (mostly in Private Sector and Class IV employees in Govt and pensioners); Factory Workers, Anganwadi teachers, Anganwadi Ayahs, ASHA workers, RTC Drivers, Private Schools teachers
  • Self Employed (business owners, Building contractors, Dairy Owners etc)
  • Small and Marginal Farmers
  • Skilled and unskilled wage laborers

The Loan Against Property (LAP) scheme offers a flexible repayment period ranging from a minimum of 3 years to a maximum of 12 years. However, the precise duration of the loan term is contingent upon the applicant's cash flow assessment. Additionally, the LAP facility extends financing from a minimum threshold of Rs. 3 lakh to a maximum limit of Rs. 1 crore, providing borrowers with a diverse range of borrowing options suited to their individual financial needs and property valuations.

Interest rates will be determined and fixed following a comprehensive risk assessment, taking into account factors such as the cost of funds and operational expenses. These rates may vary across different loan schemes, loan amounts, and borrower categories. Additionally, processing charges, subject to periodic adjustments, will be levied. The interest rates offered range from 19% to 24%, while processing fees typically vary between 2% and 3%.

LAP underwriting to include the KYC verification, Income assessment of the borrower or the household and technical/legal evaluation of the property. KYC norms are to be followed as per the RBI applicable guidelines. For Income assessment, defined income matrix to be followed for identified profession type. The income assessment to also ensure that the borrower indebtedness is maintained at reasonable level. Further, legal and technical assessment of property is done to ensure the ownership and valuation of the collateral.

Apart from document verification, personal discussion and reference check are the key components of entire underwriting process.

Our company is committed to maintaining transparency and fairness in its dealings with borrowers. In line with this commitment, we ensure that any changes in terms and conditions, including disbursement schedules, interest rates, service charges, and prepayment charges, are communicated to borrowers in a language they understand. Changes in interest rates and charges are implemented prospectively, meaning they will apply only to future transactions and will not affect existing loan terms. To enforce this practice, a clause regarding communication of changes in terms and conditions is included in all loan agreements, reaffirming our company's commitment to transparent and fair practices.

We cordially invite you to visit our nearest branch for comprehensive information regarding the array of products we offer. Alternatively, you may explore our offerings on our website at https://keertanafin.in for further details.

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