When someone fails to get a loan from the traditional banks & NBFCs, a Loan Against Property (LAP) from private lenders is a smart way to raise funds quickly using your residential, commercial, or industrial property as collateral.
Whether you’re a business owner in need of working capital, vendor payments, trying to meet a payment deadline, or an individual looking to fulfill urgent requirements, private finance offers faster and more flexible alternatives compared to traditional banks.
📌 What is a Loan Against Property from Private Finance?
A Loan Against Property (LAP) from private finance is a secured loan issued against a property to raise funds, in cases where the borrower fails to raise a loan from the traditional banks & NBFCs. It is opposite to the banks and NBFCs that require strong credit scores, income proofs, and clean financials; private lenders focus more on the market value and title clarity of the property.
These loans are offered by private financiers, NBFCs, HNIs, and private investment firms.
💡 When Should You Consider LAP from Private Lenders?
Private LAP is suitable when:
- You are not eligible for bank loans due to a low CIBIL score or past loan defaults
- Your loan has been classified as an NPA or is under SARFAESI proceedings
- You need urgent funds and cannot wait for lengthy bank approvals
- You are looking to clear debts or need to close a One-Time Settlement (OTS)
Apply Now -for Private LAP
🧾 Documents Required for Private LAP
While private lenders have fewer documentation requirements than banks, the following documents are typically needed:
- Ownership documents of the property
- KYC of the applicant (PAN, Aadhaar, passport, etc.)
- Company KYC (PAN, Partnership deed/MOA/COI & GST Certificate)
- Photographs of the property
- Valuation report (if available)
- Company financial documents (ITR, GST returns, etc.)
- Business Profile
🏗️ Types of Properties Accepted
Private financiers generally accept:
- Residential flats or houses (self-occupied or vacant)
- Commercial spaces (shops, offices, showrooms)
- Industrial units (factories, warehouses)
- Vacant land in prime locations
The loan amount is usually 50% of the current market value of the property.
✅ Benefits of LAP from Private Finance
- Fast disbursal: Loan sanctioned in days, not weeks
- Flexible terms: Customized repayment options
- No CIBIL barrier: Bad credit history is not a deal breaker
- Collateral-based: The Loan is approved based on the property value, not the income
- Use funds freely: No restriction on fund utilization (business, education, emergencies, etc.)
💰 Interest Rates & Tenure
ROI:
Private LAP interest rates range between 16% to 20% per annum, depending on risk, location, and property value.
Loan Repayment Tenor
Tenures typically range from 1 year to 5 years, with options for bullet or EMI-based repayment.
Disbursal
On successful approval, the loan is disbursed within seven to ten working days.
⚠️ Points to Remember
- A clear title and no legal disputes on the property are required
- It could be costlier than the standard loans
- Plan for the refinance of the Private loan after some time
- Avoid higher loan amounts to ensure low interest expenditure
📍 Cities Where to Get a Private LAP in India?
You can get a private loan against property in cities like:
- Mumbai, Pune, Navi Mumbai
- Delhi NCR (Gurgaon, Noida)
- Bangalore, Chennai, Hyderabad
- Ahmedabad, Surat, Indore
- Tier 2 cities, depending on property quality
🔚 Conclusion
A Loan Against Property from Private Finance is a powerful tool to fulfill urgent financial requirements when conventional banks are not extending their loan facilities. It also ensures faster approval, less paperwork, and flexible loan terms.
