Eligibility factors for a Home loan against property:

The home loan against the property is a better option to opt for the applicants instead of getting financed by the current recurring income. The borrower needs to submit the documents with a clear title of the property to get the loan approved. While opting for the loan against property, the borrower can opt for the loans even in a low cibil score. There is a surety for the lenders that the parcel can easily be sealed, and the amount can be recovered, thus giving surety to both the borrower and lender. The borrower can utilize the funds for buying a new property, do the property’s renovation, use the liquid cash in hand for the business expansion, or any personal loans for the travel purpose. Etc. The eligibility up to the extent to which the borrower can opt for a loan is up to 60-70% of the total property valuation.

The borrower needs to submit the documents to the lender to get the liquid cash in hand. The property documents need to be handed over to the lender so as to avail of the loan and get some liquid money in writing. The borrower can collect the mortgaged property documents after repaying the loan principal amount plus the interest amount. If the borrower repays the loan amount in an early stage, then the borrower can take possession of the documents in an early stage. Also, in case of the timely re-payment, the borrower’s CIBIL score can get improved, thus helping the individual get loans or avail any of the credit facility in an easy and simpler way for all future credit requirements of an individual.

The following are the eligibility factors for a loan against property:

  • The borrower should have documents with clear titles:

The borrower should submit the documents with clear titles. The property should be registered in the name of the single owner only, while as if the joint owner exists, then the application for the loan is rejected.


  • The Income criteria of an individual:

The borrower should have a sufficient bank balance and the borrower should have a consistent income and re-payment capacity while applying for the loans. The borrower’s eligibility criteria against the income criteria get reduced while applying for the loan against property. 


  • The CIBIL ratings taken into consideration:

The cibil ratings also carry lesser weightage on the borrower’s loan application approval. The borrower needs to submit the documents with the lender to avail the credit facility to the loan applicant. The borrower is found amongst major wilful defaulters in their previous loans, and then the possibility is that the borrower’s loan application may be rejected. 


  • The credit limit extended against the property valuation:

For the credit limit extended against the property, the borrower’s credit limit is decided based on the property which he has mortgaged to the lender while applying for the loan. The ready reckoned rates of the property depending on the size and the locality are taken into consideration while deciding the borrower’s credit limit. On average, 60-70% of the total valuation is given as the loan to the borrower. 


Criteria to calculate the loan against property eligibility by the borrower:

The applicant’s re-payment potential can be assessed based on net income, location, cibil score, qualification, and job profile. The loan eligibility can also be decided based on the type of property and property site based on which the loan is taken. The property should be available with clear titles as well as there should be no co-owner of the property. Also, the properties without clear labels or illegal encroachment are liable to be rejected by the borrower. 


The process to apply for the loan against the property:

  • The applicant needs to fill-up the form for the application process to start processing the loan application.
  • Check with the terms and conditions of the application before proceeding with the loan application, and after all the terms are found to be satisfactory, only the agreement should be signed.


The loan eligibility also depends on whether the applicant is salaried, self-employed, for that the borrower needs to submit the following documents to obtain the loans:

  • Application form with a recent passport size photograph.
  • Proof of identity( pan card, aadhar card, passport, voter id)
  • Address proof(Ration card/ telephone bill electricity bill/ rental agreement/Passport copy/ bank passport/ driving)
  • Age proof [ Pan card/ passport/ any other candidate from a statutory body)
  • Bank statement{ bank statement/ bank passbook for last 6 months}
  • Form 16
  • Income tax returns for the last three years.
  • Processing fee cheque
  • Documentation about the property as collateral.



Thus we conclude that the borrower should opt for the loan against property as it is the safest and clear, and transparent way of applying for the loan. The borrower should submit all the necessary documents with clear titles to the lender to avail of a loan against the property. Also, the borrower should not delay any installments payment as it can attract heavy penalties being charged to the borrower. The borrower is expected to repay loans on time and take away the mortgaged documents when all the liability is completed. The full and final settlement form should be filled up by the borrower to get rid of all the process formalities.

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