A Loan Against Property can be an ideal funding solution to meet urgent business or housing expenses. A Loan Against Property is a secured mortgage loan that lets you mortgage your property and seek a loan of Rs.5 Crore* or higher, based on your eligibility and requirements.
The prime benefit of a Loan Against Property is that it comes with end-use flexibility. Therefore, the funds availed of through a Loan Against Property can be used for housing-related expenses, such as a home renovation or remodelling, or business-related expenses. You can also use the funds to consolidate your debts.
Another factor to consider is the tax benefits of a Loan Against Property. A Loan Against Property allows you at least two claims under the Income Tax Act, 1961.
| Tax Provision | Income Tax Implication on a Loan Against Property |
|---|---|
| Tax Exemptions Under 24(b) | Applicable for salaried borrowers who have availed of a Loan Against Property to buy a new residential property. The tax deductions are valid on the interest component of the repayment amount, up to Rs.2 Lakh. |
| Tax Exemptions Under 37(1) | Applicable for borrowers who have availed of a Loan Against Property to meet business expenses. One may claim rebates on the interest component of the loan, the processing fees, and the documentation fees as business expenses while filing the claim. |
*Terms and conditions apply.
Frequently Ask Questions
A Loan Against property is one of the most preferred funding solutions to meet big-ticket expenses. There are several tax benefits that you can enjoy by availing of a Loan Against Property. Tax exemptions under Sections 24(b) and 37(1) can be availed of. However, tax benefits are not applicable if a Loan Against Property is used for personal purposes.
No, borrowers cannot seek tax benefits under section 80C. Tax benefits for Loan Against Property are applicable under Sections 24(b) and 37(1).
A Home Loan and a Loan Against Property are substantial financing options, but they serve different purposes. It's not possible to convert a Loan Against Property into a Home Loan, as these two types of loans are distinct in nature and have different eligibility criteria.
Bajaj Housing Finance offers a Loan Against Property starting from 9.40%* p.a. for a self-employed applicant. The interest rates are determined by several factors including property’s value and CIBIL score.
Disclaimer
The information remains subject to change depending on the laws and government guidelines, applicable at the time being. However, Bajaj Housing Finance Limited (‘BHFL’) is under no obligation to update or keep the information current. Users are advised to seek independent legal and professional advice before acting on the basis of the information contained in the Website. Placing reliance on the aforementioned information shall always be the sole responsibility and decision of the User and the User shall assume the entire risk of any use made of this information.
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