SBI Loan Against Property - Types of SBI Loans Against Property

What Are the Different Types of SBI Loans Against Property?

It can be broadly divided into two types:

a) Loan Against Mortgage of Immovable Property

• This kind of loan is issued against mortgage of properties that are immovable in nature. Let's look at the features:
• The loan is issued for general purpose use, and it should not be utilized for any other purpose, like in the real estate market or the capital market.
• The minimum amount of loan disbursed under this scheme is Rs.10 lakhs, whereas the maximum loan amount offered is Rs. 5 crore
• Also, the ratio of Equated Monthly Installment and the Net Monthly Income should never exceed more than 50%.
• The final amount of the loan is 65% of the market value of the mortgaged property, so that the ratio of Equated Monthly Instalment to the Net Monthly Income does not exceed 50%.
• A customer can repay the loan within a maximum period of 180 months.
• The customer can also prepay the loan anytime, as SBI does levy any charges on prepayment of the loan.
  

 b) Rent Plus Loan Against Property

• SBI's Rent Plus Loan-Against-Property offers loans against the assignment of future rents to commercial and residential property owners to meet their monetary requirements. Let's look at the features of the loan:
• The amount available under the scheme is calculated as the lowest of the realizable value of the mortgaged property. This is calculated as per the valuation by SBI as the maximum permissible amount under the scheme, or 75% of the total rent receivable over the loan period minus the advance deposit, TDS, estimated amount of property tax, service tax, and other statutory dues of the period.
• The minimum amount of loan permissible under this scheme is Rs.50, 000, and the maximum is Rs. 5 crores for non-metro cities and Rs. 7.5 crores for metro cities.
• The State Bank of India has reserved a margin of 25% of the loan amount.
• The repayment period for this scheme is either a maximum of 10 years or the residual period of lease of the property, whichever is less.
• Repayment of the EMI for these loans can be made through post-dated cheques drawn against the applicant's bank account, through the ECS facility, or by issuing a Standing Instruction to the bank to deduct the EMIs as and when they fall due from the applicant's savings or current account. However, to avail the Standing Instruction facility, you need to have an existing bank account with SBI.
• The processing fee of this scheme is 2.02% of the loan amount + GST + service tax.  A maximum amount of Rs. 1,01,865/- should be paid upfront as processing charges.
• As there are no prepayment charges, a customer can prepay against the loan to reduce the interest rate.
  

What Are the Highlights of SBI's Loan Against Property?

Let's look at the advantages of availing a loan against property from SBI:

• The complete process - from application to disbursal - is transparent.
• A customer can access any of the loans against property from SBI's vast network of branches all across India.
• Interest rates on the loan amount are levied following a monthly/daily reducing balance method.
• SBI offers the lowest processing charges.
• Customers can repay their loan in a maximum period of 180 months.
• There are zero hidden costs or administrative charges.
• A customer can prepay without worrying about prepayment charges if he/she has extra funds at any point.
  

What Is the Eligibility Criteria for These Loan Schemes?

Eligibility for Loan Against Mortgage of Immovable Property

• This SBI scheme is available to professionals, employees, self-employed individuals, or others who have a piece of property in their name or the name of a third party, provided the third party agrees to guarantee the loan.
• The minimum net monthly income for a salaried employee should be Rs. 25,000, while for others, the minimum net annual income should be more than Rs. 3 lakhs.
• The maximum age limit of an applicant is 70 years at the time of loan liquidation.
  

Eligibility for Rent Plus LAP

• This scheme is made available to owners of commercial properties or residential buildings that are to be rented or are already leased to MNCs, banks, or other medium-sized or large corporates.
• The property should be located in a metro, urban, semi-urban, or rural area.
• The applicant should have all the plan approvals and other related permissions from appropriate authorities in place for the property.
• The property should not, previously or currently, be leased to colleges, hospitals, schools, nursing homes, orphanages, or any other social sector infrastructure.