1. Build your Credit Score
2. Reduce your Current Borrowing / EMI Costs
Loan against property (LAP) is a multipurpose loan that helps an individual in raising funds against his assets. An individual buys assets to secure his/her money through investment. However, there can be times when, despite having properties at different places, an individual faces a cash crunch and has to find a source for liquid funding. During such times, your existing property can help you avail loans from Kotak Mahindra Bank at a lower interest rate, in comparison to other loans.
Kotak Mahindra Bank LAP Interest Rates and Processing Fees |
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Category |
Salaried Professionals |
Self-Employed Individuals |
Firms/ Companies |
Interest Rate |
9.25%-11.50% |
9.25%-11.50% |
9.25%-11.50% |
Processing Fees |
0.5% to 3.00% + GST |
0.75% to 3.00% + GST |
0.75% to 3.00% + GST |
Pre-payment charges |
No prepayment/foreclosure is allowed until the lapse of the lock-in period of six months after EMI commencement. After the lock-in period, part prepayment of a minimum of Rs. 25,000/- and a maximum of upto 25% of the outstanding loan amount can be made every six months without any prepayment charges. |
Nil with variable interest rates |
Up to 3% |
Foreclosure Charges |
Nil (with variable rates of interest) |
Nil (with variable interest rates) |
Up to 3% |
Tenure |
10-12 years |
10-12 years |
10-12 years |
Late Payment Fees |
Up to 24% |
Up to 24% |
Up to 24% |
The applicant can avail this loan against any kind of property, be it commercial, residential, or industrial.
Loan Tenure: The loan is issued for a maximum tenure of 10 years. However, the period of repayment varies depending upon the purpose of the loan and the applicant’s business profile.
The applicant can avail a loan amounting from Rs.10 lakh - Rs.3 crores.
In the case of commercial property, an applicant can avail a loan of up to 55% of the cost of the property.
The bank decides the loan amount according to the repayment capacity of the borrower. The repayment capacity is determined based on the borrower’s income, age, educational qualifications, number of dependents, income of spouse, assets, liabilities, savings history, occupation, business profile, the operational time of the existing business and the net take-home salary.
Kotak Mortgage Loan can be applied for by customers either jointly or individually.
The bank also offers the facility of extending the scope of eligibility to the borrower by adding a co-applicant while applying for a loan. In such cases, the income of the co-applicant is also considered before approving the loan amount.
For a loan against property from Kotak Mahindra Bank, the co-applicant can be parents, the spouse, or even children (above 18 years old) of the borrower.
The bank generally keeps the property under a mortgage, as security till the maturity of the loan period. However, in some cases, the applicant can also provide additional securities such as LIC policies or term deposit receipts issued by Kotak Mahindra Bank.
Kotak Bank also allows prepayment of the loan. However, early redemption fees as applicable will be levied by the bank.
Kotak Bank customers can use the EMI calculator to calculate the EMIs on the loan amount, for which they will need three principal elements: loan tenure, loan amount, and rate of interest.
Kotak Mahindra Commercial Property Purchase Loan
Commercial property buyers can avail this loan from Kotak Mahindra Bank at very attractive interest rates. Here are some of its prominent features:
Eligible Borrowers: Salaried, self-employed, and businesses.
Type of Property: The bank offers commercial property purchase loans only for properties whose stage of construction is more than 80 percent.
Low Interest Rate: 9.25-11%
Tenure: Maximum ten years
Loan amount: Rs.15 lakhs-20 crores
Processing Fees: 1-3% of the loan amount, plus GST
Eligible loan amount: Up to 60% of the cost of the property or 90% of the current market valuation of the property, whichever is lower.
Kotak Mahindra Bank Overdraft Facility
Salaried and self-employed applicants opting for a loan against property from Kotak Mahindra Bank get an option to borrow either a term loan or a dropline overdraft(OD) facility. In the case of an OD limit, the borrower pays interest only on the loan amount that is used. Given below are some of the vital features of Kotak Mahindra Bank LAP OD:
The overdraft facility is available mainly for self-employed borrowers.
Interest is payable only on the used sum of the loan amount and not on the entire sanctioned limit.
The limit can be reset based on the eligibility of loan applicants after completing a tenure of one year.
Kotak Mahindra Bank Lease Rental Discounting (LRD)
Kotak Mahindra Bank provides lease rental discounting(LRD) loans to both salaried and self-employed borrowers who get monthly rental income from reputed lessees. The loan amount Kotak Mahindra Bank offers in the LRD scheme can go up to eighty times of net monthly rentals, subject to the expiry clauses of a lease agreement. Kotak Mahindra Bank offers a lease discount loan against commercial and industrial properties leased for over one year with renewable clauses in the rental agreement.
Eligible borrowers: Salaried and self-employed individuals, firms, and companies.
Type of property: Commercial shops, offices, and industrial premises such as warehouses, factories, workshops, etc.
Tenure: Up to 10 years, depending on the lease term of the rented property.
Loan amount: 15 lakhs-20 crores
Processing fees: 0.50-1% of the loan amount.
EMI: The bank restricts the EMI to 90% of the net monthly rentals.
Customers can also transfer the loan from another bank to Kotak Mahindra Bank for a lower interest rate, which can significantly reduce the loan burden and monthly outgo on EMIs.
To apply for a Kotak loan against property, you must either be a self-employed individual or a salaried employee working in a renowned private or government organization.
For Salaried Employees
The minimum permissible age is 23 years, and the maximum is 60 years.
The minimum monthly income should be Rs.30,000/- and work experience should be three years.
Minimum credit score required: 700
For Self-Employed Professionals
The minimum annual income should be Rs. 1.44 Lakhs as per the P&L account.
The minimum permissible age is 21 years.
The maximum age is 65 years during loan maturity.
The firm/company should have been in operation for the last three years.
The firm/company should have been making profits for at least the last two years.
The documentation process is easy and hassle-free. The following documents are required for the process:
For Salaried Individuals
Application form with photograph
Residence proof (any of the given options)
Aadhar card
Ration card
Telephone bill
Electricity bill
Voter ID card
Identity proof
Voter ID
Driving licence
Aadhar card
Employer’s ID
Bank statement of the past six months showing your salary or income details
Salary slips for the last six months
Photocopies of all property-related documents
From-16 for the past two years
For Self-Employed Individuals
Certified financial statements for the last three years
Residence proof
Aadhar card
Ration card
Telephone bill
Electricity bill
Voter ID card
Identity proof
Voter ID
Driving licence
Aadhar card
Employer’s ID
Bank statement of the past six months showing your salary or income details.
Salary slips of the last six months
Photocopies of all property-related documents
An EMI (Equated Monthly Installment) is the amount of money that you pay the bank towards repayment of your property loan every month on a fixed day of the month till your loan is fully paid back. With Kotak Bank now offering loan tenures of up to 12 years at attractive interest rates starting from 9.60%, your EMI can be as low as Rs. 1,172/ 1 lakh. The EMI comprises both principal and interest payments. While the EMI amount remains constant, the interest component of the loan keeps reducing, and the principal component keeps increasing, except in the case of an increase in the interest rate.
Applying for a Kotak Bank loan against property is easy. You can apply for it either online or by visiting a nearby bank branch.
Applying Online
You can visit the official website of Kotak Mahindra Bank and select the ‘Apply Now’ option under the ‘Loan Against Property’ page. You will be redirected to a page where you can fill in your personal and income details. After completing the application form, submit it for validation. A representative from the bank will then contact you for the documentation process, following which it will be sent for approval.
Applying Offline
Visit the nearest Kotak Bank branch and apply for the loan directly.
How does the bank decide the amount of loan against the mortgaged property?
The bank determines the loan amount based on your income, age, qualification, spouse’s income, assets, liabilities, reliability, and stability.
What kind of properties can Kotak Mahindra Bank take as collateral security for LAP?
Kotak Mahindra Bank provides LAP against residential, commercial, or industrial property.