What is Loan against Property?
A Loan against property or LAP is a loan given by the lender to the consumer against the property mortgaged.
Unlike the unsecured loan, the loan against property includes a security that is the property, which the customer can mortgage in case the loan is not repaid by the borrower. Hence, it is a type of mortgage loan.
In such loans, the market value of the property is calculated and the loan provided is a certain percent of the market value of the loan.
For what purposes can LAP be taken?
Loan against property (LAP) has the low desire rates which can be used for company or personal finance reasons:
These loans can be used for expansion of the business and meeting the credits of the business and bonafide needs.The loans are easy to avail so they can help in case of an urgent medical financing.The loans are also useful to facilitate the renovation or repair/extension purposes in the house or flat.
The loan can be used if there is a marriage in the house.The parent can use this loan for sending the child abroad for higher studies.One can use the loan to fund a vacation to an attractive tourist destination.