State Bank of India (SBI) offers loans against property under its personal finance portfolio. SBI's loans against property give cash requirements against the individual's asset (or property), as mentioned on the official website of SBI. Loan against property can also be called an all-purpose loan. In case of a cash crunch, customer can leverage a property and avail this loan. Repayment to the bank is to be done in form of EMIs (Equated Monthly Instalments) at an interest rate pre-decided by the bank.
Key things to know about State Bank of India (SBI)'s loans against property:
1. Loan against property (LAP) is a purpose loan available against mortgage of residential and/or select commercial property. (Also read: Five Home Loan Products Offered By SBI. Details Here)
2. The minimum loan amount that can be taken is Rs 10 lakh and maximum limit is Rs 7.5 crore, subject to location of property, said SBI.
3. Any individual who is an employee or a professional, self-employed or an income tax assesses or NRIs (who has residential property or commercial properties in his own name or in the name of spouse / children/parent/sibling) is eligible to avail SBI's loan against property. Also an individual with at least a minimum net monthly income of Rs 25,000 (or Rs 3 lakh per annum) can apply for this type of loan. Loan under LAP should be liquidated before eldest borrower attain the age of 70 years, mentioned SBI. (Also read: SBI Vs HDFC Bank Vs ICICI Bank: Car Loan Interest Rates, Features Compared)
4. In cases where the commercial properties are rented out on lease, equitable mortgage on the property is created and assignment of rental receivable is obtained. In addition a tripartite agreement / irrevocable power of attorney are also required.
5. The tables below represent the loan liability and interest rates w.e.f 01.11.2016:
6. The processing fee includes 1 per cent of the loan amount plus service tax which can go maximum up to Rs. 50,000 plus service tax.