What-is-LTV-in-Loan-against-property
- LAP

What is LTV in Loan against property?

Credit requirement is a necessity in today’s time for many working class individuals. This requirement is because of our never ending wants and needs. There are many lenders in the market that provide us with various loans to fulfill our needs. These options range from personal loans, credit card, home loans, business loans and loan against property. For needs which require a large sum of money, taking a loan against property is wise.

What is a loan against property?

Loan against property (LAP) is a secured loan where a person has to keep his/her property as collateral in order to get a loan. As per the current market value of the property, the Bank/NBFC will give the person an amount which is decided keeping many factors in consideration. The person can use this amount to fulfill any leads. The lender has no say in how the person wants to spend that money.

How is the loan value decided?

When you apply for a LAP, the lender will first check your income level and credit score. They will also evaluate your property. This is to derive your current market value of the property. Once they derive that, using “Loan-To-Value” they will derive the loan amount which can be given to you.

What is Loan to Value?

Loan to Value (LTV) is a set percentage which is decided as per your property’s current market value. This value differs from property to property. There is a set percentage derived for residential and commercial properties. You can get around 60-70% of your property value as the loan amount. This amount can be used to utilize any of your financial obligations.

Is taking a LAP better?

If you need a higher loan amount to fulfill your needs, taking a loan against property can be a good option. So you can apply for a loan against property today.

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