State Bank of India Loan Against Property

Features & Benefits of SBI Loan Against Property

A loan against property is a scheme where a borrower attaches their real estate assets as collateral to get credit against the same. Here, the property should be directly owned by the borrower. Furthermore, the property remains collateral throughout the maturity or until the amount is paid out fully. The risk of a loan against property is that one could potentially default on their real estate property if they fail to pay the borrowed amount. Various lending institutions offer this service, and customers avail of this facility to meet various personal needs that involve huge monetary capital.

Some of the top banks that offer this scheme include the State Bank of India. SBI, established in 1955 with regulations from the government of India and the Reserve Bank of India, is considered a top contender for customers to seek out financial services and products. The SBI Loan Against Property is a niche product offered to customers to meet various financial ends.

SBI, being one of the major banks in India, has designed its SBI loan against property scheme with lucrative features and benefits. Some of the features and benefits of the SBI LAP scheme are listed below.

• Attractive and competitive interest rates
• The application for the SBI loan against property is disbursed with low processing charges. 
• Transparency in the transaction
• There are no charges for making any prepayments
• Interest is availed on daily reducing balance

SBI Loan Against Property Interest Rates

The State Bank of India offers its customers SBI LAP interest rates based on the CIBIL score of each individual. There are classes specified for which a varied rate of interest is assigned. Furthermore, with attractive SBI LAP rates, customers can be assured of getting the best deals from the institution. The table below shows the range of CIBIL scores and their respective interest rates.

Factors affecting SBI Loan Against Property Interest Rates

It is never easy for a lending institution to determine the ideal interest rate to offer to their customers. There should be a fine balance between the market rates, regulatory requirements, and profitability. With SBI LAP interest rates, the institution devises its plan with respect to a customer’s CIBIL score. Moreover, various sub-factors come into play which guide SBI to establish a lucrative rate of interest. Here are some of the main factors which affect the SBI Loan Against Property Interest rates in India.

• Demand for Money - In an economy, the outflow of money has to be balanced out with the inflow. And when it comes to financial institutions lending out their capital, they need to devise an interest rate that averages out the receivables. This means that a fine-tuned rate of interest needs to be devised to equalise the supply and demand of money.
• Credit Score of the Borrower - Banks take an individual's credit score seriously. Some agencies solely involve themselves in analysing individual borrowers and their creditworthiness. A credit score and credit rating are assigned to each of them, which banks finally take into account to determine what interest rate should be ideal for balancing the credit risk.

Some of the subcategories of factors that affect interest rates are as follows.

• Income of the Borrower - Banks need to be assured that a borrower will be able to pay back their loans. Consequently, income plays an important role in determining whether a borrower can repay. The lesser the borrower's income, the higher the interest rate assigned.

• Tenure of the Loan - The duration of a loan term also affects how much the borrower will bear an interest rate expense. The longer the tenure, the more the interest payable.

• Real Estate Type - When it comes to SBI loans against property, the real estate type also affects how the interest rate is designed. Commercial properties attract more interest rates, whereas residential properties get lesser. The valuation of the property also affects how the interest rate is determined.

• Credit History - When it comes to the history of credit and loan repayment patterns, banks take note of the same and assess whether or not to sanction a loan. This goes with an individual's credit score, and interest rates could vary depending on the person’s creditworthiness.

Eligibility Criteria for SBI Loan Against Property

Applicants must know that there are various parameters that one needs to adhere to to be able to apply for the SBI loan against property. Here are some of the pointers for the SBI Loan Against Property Eligibility.

• All the applicants must be a resident of India. 
• The minimum age requirement for making an application request for SBI Loan Against Property scheme is 18 years.
• The maximum age is set to be 70 years. 
• Customers can select a tenure of up to 15 years.
• Applicants must possess all the documents required to authenticate identification and residence proof.

SBI Loan Against Property Fees and Charges

SBI Loan Against Property incorporates processing fees and charges depending on the home loan product. Customers will have to pay them duly, along with a down payment if applicable. Although SBI Loan Against Property has such charges, they are minimal and fair compared to many lending institutions. Here is a guide to the SBI Loan Against Property Fees and Charges that a customer has to incur when applying for a loan.

Some miscellaneous charges for SBI Loan Against Property are as follows:

• 1% processing fee along with applicable taxes. The maximum fee chargeable is INR 50,000. 
• There will be a house evaluation fee, including the advocate’s fees for title investigation.
• Stamp duty for loan processing
• Premium amount payable for insurance of large sanctions 
• CERSAI registration fees which range from INR 50 to INR 100.

Documents required for SBI Loan Against Property

There are requirements for various documents which the SBI uses to authenticate an applicant’s claims of who they are. These documents must be supported with property documents for getting SBI Loan Against Property quotes. Here are the important documents required for applying for Loan Against Property in SBI.

• Identification card of the employer
• Completed loan application form with attached passport-size photographs. 
• Any identification card including passport, PAN, Voter ID card, Driver’s Licence, etc. 
• Residential proof cards such as copies of electricity bill, telephone bill, water bill, piped gas bill, etc.

The property papers that will be required to be submitted while applying for SBI Loan Against Property scheme are as follows:

• If applicable, the customer has to show papers of construction permission. 
• Stamped sale agreement.
• Occupancy certificate
• Maintenance certificate, if any
• Plan approval document
• Payment proof with the bank statement.

If an applicant is a salaried employee, they must share the following documents.

• Salary slip 
• Three-month salary certificate
• Form 16 
• Copy of IT return statement

Applicants that are non-salaried professionals will be required to produce the following documents.

• Location proof of the business office
• Last three years statement of income tax filing
• Balance sheet statement
• Profit and loss statement of last three years
• Licence copy
• Tax deduction details 
• Professional qualification certificate

How does the EMI calculation work for SBI Loan Against Property?

It is now easy to calculate an SBI Loan Against Property EMI with an online SBI LAP Calculator tool. This will incorporate details pertaining to the loan amount, loan tenure, and applied interest rates. With the help of the Loan Against Property EMI Calculator, customers can get a brief about how their expense is structured. This is a crucial piece of data that can be used to determine whether or not the SBI Loan Against Property is affordable.

Moreover, users can also plan their finances per the recurring expense cycle. The SBI Loan Against Property interest rate is generally calculated with the help of a mathematical formula. This is as provided below.

{P x R x (1 + R) ^ N} whole divided by { (1 + R) ^ N (N - 1) }

• P being the principal 
• R being the rate of interest 
• N being the loan duration

How does SBI compare with other lenders?

There is no doubt that SBI is one of the leading financial institutions in the country. Their financial services and products are top-notch and very popular among their customers. The table below shows how SBI compares with other banks and their annual LAP interest rates.

SBI Loan Against Property Customer Care Number

In case any customer needs any assistance from the bank directly. They can get in touch with the customer representatives. There are a few ways in which they can do so.

• Toll-free number - 1800 11 2018 
• Head Office - Real Estate and Housing Business Unit, State Bank of India, Corporate Centre
• Madame Cama Road, State Bank Bhavan, Nariman Point, Mumbai-400021, Maharashtra

Furthermore, there are various bank branches across the country. One can simply locate these branches by following the steps mentioned below:

• Go to the official website of SBI
• From the main menu, click on the Contact Us option
• Select the branch locator option from the interface
• Provide preferred search options such as State/District/City, Branch name, or Branch code, or Pin code. 
• You will have the list of branches narrowed down.