Why Take a Loan Against Property?
LAP is one of the most powerful financial tools for business owners and individuals needing high-ticket funding. Instead of taking an unsecured Personal Loan at 14-16% or a Business Loan at 16-18%, you pledge your property to secure a massive loan at a much lower rate (typically 9.5% to 11%).
- The LTV Cap: Banks will never lend you 100% of the property's value. For residential homes, the Loan to Value (LTV) maxes out around 65-70%. For commercial properties or vacant plots, it drops to 50-60% because they are harder for the bank to liquidate in case of default.
- No End-Use Restriction: Unlike a Home Loan (which must be used to buy a house) or a Car Loan, the money from a LAP can be used for anything: expanding your business, paying for a child's overseas education, or consolidating high-interest debt.