Best Bank for Loan Against Property in India

If you need urgent funds for a wedding, education, medical expenses, or business expansion, a Loan Against Property (LAP) is one of the best solutions. It offers high loan amounts, competitive interest rates, and flexible repayment terms compared to personal loans.

But the common question is:
- Which is the best bank for loan against property in India?
- Or should you consider the best NBFC for loan against property instead?

This guide compares the top banks and NBFCs offering LAP in 2025 so you can make the smartest choice.

What is Loan Against Property (LAP)?

The loan against property is a secured loan where you pledge your property (be it a residential space, commercial land, or industrial property) as collateral/security to the bank or NBFC. You continue to own and use your property, but the lender holds it as security until the loan is fully repaid.

Key benefits of LAP:

• Loan amounts of up to ₹10 crore (depending on lender & property value)
• Lower interest rates than unsecured loans
• Longer repayment tenure (up to 20–25 years)
• Flexibility to use funds for personal or business needs

What Makes a Bank or NBFC the “Best” for LAP: Factors to Consider

Here are some simple factors to consider when choosing the best bank to get loan against property:

• Interest Rate: Lower interest means that your EMI will be less and, naturally, the total cost of your loan will also be less.
• Loan-to-Value (LTV): Higher the LTV, more money you can borrow against the value of your property.
• Tenure (Repayment Period): The longer you go for repayment, the less monthly EMI you have to pay, and that becomes easier for you to manage.
• Processing & Foreclosure Charges: Lesser fees in processing or foreclosing of a loan will further lessen your expenses.
• Speed & Convenience: Quick approval and an easy application process are a big help when you need money in a hurry.

Comparison of Best Banks & NBFCs for Loan Against Property in India (2025)

Best Bank to Apply for Loan Against Property in India (2025)

Looking for which bank is best for loan against property? Here are some best banks for LAP loan that charges low interest rates:

1. HDFC Bank

• Interest Rate: 7.75% – 11.70% p.a. (Avg. 9.05%)
• Loan-to-Value (LTV): Up to 65% of property value
• Highlight: Transparent processing, wide availability, flexible tenure up to 15 years.

2. State Bank of India (SBI)

• Interest Rate: 1.45% to 3% + 1-yr MCLR (currently around 9.15% – 11.25% p.a.)
• Loan Amount: ₹10 lakh – ₹7.5 crore
• Highlight: Lower processing fees, nationwide presence, reliable public sector option.

3. Bank of Baroda (BoB)

• Interest Rate: 9.15% – 11.75% p.a. (depending on risk rating)
• Special: 0.25% concession on takeover loans
• Highlight: Flexible options like mortgage loan and future rent receivable LAP.

4. IDFC FIRST Bank

• Interest Rate: Starting at 9.50% p.a.
• Processing Fees: Up to 3%
• Highlight: Digital process, top-up options, tenure up to 20 years.

5. Tata Capital

• Interest Rate: 9% – 17% p.a. (floating); 13% – 17% (fixed)
• Loan Amount: Up to ₹10 crore
• Highlight: Good for high loan requirements with flexible repayment.

6. Axis Bank

• Interest Rate: ~10.50% – 11.00% p.a.
• Loan Amount: ₹5 lakh – ₹5 crore
• Highlight: Both fixed and floating rates available, quick online process.

Best NBFCs for Loan Against Property in India (2025)

If you are considering a Loan Against Property (LAP), Non-Banking Financial Companies (NBFCs) can often provide faster processing, flexible terms, and competitive rates. Here are some of the top NBFCs for Loan Against Property in India with updated interest rates:

1. Bajaj Finserv

• Interest Rate: 9% – 12% p.a.
• Loan Amount: Up to ₹10 crore
• Tenure: Up to 20 years
• Highlight: Quick disbursal, flexible repayment, high eligibility for salaried & self-employed.

2. PNB Housing Finance

• Interest Rate: Starting from 9% p.a. (depends on credit score)
• Loan Amount: Up to ₹15 crore
• CIBIL-Based Pricing:
  • CIBIL ≥ 825 → 9% (floating), 10% (fixed+floating)
  • CIBIL 800–825 → 9.85% – 10.25%
  • CIBIL 750–775 → 10.85% – 10.75%
  • Lower CIBIL scores → Higher rates (up to 11.90%)
• Highlight: Offers fixed, lifetime fixed, and hybrid (3-year fixed then floating) options.

3. LIC Housing Finance

• Interest Rate:
  • CIBIL ≥ 750 → 9.70%
  • 700–749 → 10.30%
  • 600–699 → 11.55%
• Loan Amount: Up to ₹15 crore
• Highlight: Trusted brand, large ticket sizes, ideal for long-term borrowers.

4. Aditya Birla Finance

• Interest Rate:
  • Residential LAP → 9% – 16.5% p.a.
  • Commercial LAP → 9.50% – 17.5% p.a.
  • Industrial LAP → 10% – 12.60% p.a.
  • Plot LAP → 9% – 16.5% p.a.
• Tenure: Up to 15 years
• Highlight: Flexible products for residential, commercial, industrial, and plot owners.

Tips to Choose the Best Lender for Loan Against Property

• Check credit scores: A higher one can get better rates on offers, so over 750 is preferable.
• Compare the total cost: Use an EMI calculator to calculate how much ahead you will be paying.
• Processing and foreclosure fees should be checked: The lower the charges, the cheaper the loan.
• Consider time: When it comes to speed, NBFCs such as Bajaj Finserv generally disburse loans quicker than traditional banks.

Conclusion

Choosing the best bank for loan against property or the best NBFC for loan against property depends on your needs, be it interest rate, loan amount, or approval speed.

My Mudra allows you to compare rates, fees, and features before making up your mind so that you may go with the best bank for LAP loan that perfectly suits all your financial needs. You can take advise from our consultants and select the best option for your needs.

Also Read:
- Get the Best Loan Against Property at Lowest Interest Rates
- How to Get a Loan for Property Purchase in India 2025