Want funds to expand your business or for cash flow management or to start a new project? If you have a property, you’re already sitting on a powerful asset that can help you unlock business capital. Take Out Loan Against Property (LAP) for business.
What Is a Business Loan Against Property?
A Business Loan Against Property is a secured loan wherein the borrower pledges his residential, commercial, or industrial property as collateral for receiving a loan. The money can be utilized for any business purpose, including but not limited to equipment purchases, working capital, inventories, office expansions, or even paying off high-interest debts.
Types of Property You Can Use as Collateral
- You can offer any of the following as security:
- Residential property (self-occupied or rented)
- Commercial property (offices, shops, showrooms)
- Industrial property (factories, warehouses)
- Vacant land (subject to lender approval)
Features of Business Loan Using Property
| Feature | Details |
| Loan Amount | ₹5 lakhs to ₹10 crores (based on property value & income) |
| Tenure | Up to 15 years |
| Interest Rate | Starts from 8.50% p.a. (varies by profile) |
| LTV (Loan to Value Ratio) | Up to 70% of market value of the property |
| Processing Time | 5 to 15 working days |
| Collateral Required | Yes (property) |
| Repayment Type | EMI-based or overdraft (in some cases) |
| Tax Benefits | Interest can be claimed under business expenses (Section 37) |
Eligibility Criteria
Most lenders, including Upniva partners, check the following:
- Age: 21 to 65 years
- Employment Type: Self-employed individuals, business owners, partnerships, LLPs, private limited companies
- Business Vintage: Minimum 2–3 years of business operation
- Income: Consistent revenue, supported by ITRs and bank statements
- Credit Score: 650+ is recommended
- Property Ownership: Should be owned by the applicant or co-applicant
Documents Required
- Personal KYC
PAN card, Aadhaar card, Passport, or Voter ID
Passport-size photographs
- Business Proof
GST Registration / Business Registration Certificate
Shop & Establishment License
Partnership deed (for firms), MOA/AOA (for companies)
- Income Proof
- Last 2–3 years ITRs with computation
- Profit & Loss statements and Balance Sheets (CA certified)
- Bank statements for last 6–12 months
Property Documents
Property title deed
Previous sale deeds or chain of documents
Approved building plan / map
Latest property tax receipts
How to Apply for a Business Loan Using Property (Step-by-Step)
- Step 1: Assess Your Loan Need
Decide how much funding you need and for what purpose—working capital, machinery, expansion, etc.
- Step 2: Check Property Eligibility
Ensure the property you want to mortgage has a clear title and is free from legal disputes.
- Step 3: Calculate Eligibility
Use a Loan Against Property calculator on Upniva to estimate loan amount and EMI.
- Step 4: Apply Online via Upniva
Fill in basic business and property details. A Upniva expert will connect you with the best matched lender.
- Step 5: Submit Documents
Upload KYC, income proof, business proof, and property documents.
- Step 6: Property Valuation & Legal Check
The lender will conduct a legal and technical evaluation of the property.
- Step 7: Loan Approval & Disbursal
Once approved, you’ll get a sanction letter, followed by disbursal directly into your account.
Benefits of Business Loan Against Property
- Higher loan amounts compared to unsecured business loans.
- Lower interest rates due to secured nature.
- Flexible repayment tenures (up to 15 years).
- Suitable for large working capital needs.
- Option to pre-close loan after a certain period.
Things to Keep in Mind
- Property must be free of encumbrance or co-ownership complications.
- Defaulting on the loan could lead to the lender taking possession of the property.
- Choose loan tenure wisely—longer tenure = smaller EMIs but higher total interest.
- Always read the fine print regarding foreclosure, part-payment, and processing charges.
When Should You Consider LAP for Business?
- You need ₹10 lakhs or more in funding.
- You want lower EMIs and longer repayment flexibility.
- You already have a property that isn’t generating income.
- You’re expanding your business or investing in long-term infrastructure.
FAQs: Business Loan Using Property
Can I get a loan against property for a startup?
Yes, but most lenders prefer at least 2 years of business continuity. Some NBFCs may still fund early-stage businesses with strong property backing.
How much loan can I get against property?
You can get up to 70% of the property’s market value, depending on your income and credit profile.
Can I offer rented property as collateral?
Yes, as long as you are the legal owner and the title is clear.
Is income proof mandatory?
Yes. You need to show ITRs and business turnover to support repayment capacity.
Can I take LAP for business if I already have a home loan?
Yes, if you have another property available or adequate repayment capacity.
Apply Now with Upniva
With Upniva, you get:
Free consultation with loan experts
AI-based lender matching
Transparent process & minimal paperwork
Quick turnaround from application to approval
Safe, secure, and digital application platform
Check Your Eligibility Now
Apply for Business Loan Using Property