1. What type of Property that can be Mortgaged?

Lenders give loan against those property whether they are residential (rented out and self occupied) or commercial properties. A plot or land without construction can also be considered as collateral by the lender.

2. What is Loan against Property (LAP) EMI?

LAP EMI is a defined amount you will pay for repayment of your loan monthly till the loan is completely paid.

However, the EMI amounts stays the same, every month the part of interest keeps coming down and principal keeps on increasing, except when interest rate increases.

LAP tenure in India ranges from 5 years to maximum of 18 years. Longer the tenure, lower the EMI.

3. How should one pay the EMI on loan against property?

The easiest way of paying a mortgage loan EMI is by the way of ECS in favour of the bank. It is not necessary to have a bank account in the same bank from whom you have availed the loan.

Other instruments can include post-dated cheques (PDCs) and by demand drafts, although, these are rarely used nowadays.

4. What are the benefit of paying Loan Against Property (LAP) EMI through ECS ?

Key benefit of paying LAP EMI through ECS is that, there is no signature mismatch risk for cheque bouncing or any other technical issue. Note heavy cheque bouncing charges are charged by the banks even for technical bounce and therefore, it is advisable to avoid this risk by availing ECS mode of debit.

5. How is the Loan against Property(LAP) EMI Calculated?

Loan amount – Higher the loan amount, higher will be the EMI. Rate of interest – Lower the loan interest rate, lower the EMI. Loan Tenure – Longer the loan tenure, lower the EMI.

6. Can I repay the Loan Against Property ahead of schedule?

Yes you can you can repay your loan ahead of schedule and there is no prepayment fee only if you repaying the loan from your own source of funds and without transferring the loan.

7. Who Qualifies for Loan Against Property?