When financial needs become urgent for situations like higher education, a medical emergency, or expanding your business, your property can be more than just an asset. With State Bank of India’s (SBI) Loan Against Property (LAP), you can unlock the proper value of your residential or commercial space and put it to work.
Unlike unsecured loans, SBI LAP offers competitive interest rates, flexible repayment terms, and substantial loan amounts, all while leveraging the security of a physical asset.
Read on to learn more about SBI’s LAP with this comprehensive, structured guide to everything you need to know about SBI’s LAP and other major property-related loan products.
Eligibility Criteria for SBI’s Loan Against Property
To benefit from LAP and to make the most of it, applicants must meet defined criteria. SBI ensures that both salaried and non-salaried individuals can access this credit solution if they meet these essential conditions:
- Who Can Apply: Salaried employees, professionals, self-employed individuals, and NRIs who file income tax returns.
- Property Ownership: Must be in the name of the applicant or co-owned with family (spouse, children, parents, or siblings).
- Minimum Income: ₹25,000 monthly or ₹3 lakhs annually in net income. All income sources may be assessed based on documentary evidence.
- Age Limit: Borrowers can be up to 70 years of age at the time of loan maturity.
- Co-Borrowers: Family members can join as co-borrowers or guarantors. If the property is jointly held, all holders must join the loan.
- General Requirements: Applicants should exhibit stable income, have a clear title to the property, and meet credit score benchmarks.
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Interest Rate Structure & Charges for LAP
SBI’s interest rates for LAP are structured to provide affordability and flexibility. The rates are linked to the one-year Marginal Cost of Funds based Lending Rate (MCLR), ensuring they remain aligned with market trends.
1. General Interest Rate and Reset Frequency
- Starting Rate: 7.50% p.a. (Effective from 15.06.2025)
- Reset Frequency: Annually, in line with the prevailing one-year MCLR
- Calculation Method: Monthly or daily reducing balance method
2. Interest Based on Loan Amount
| Loan Amount | Interest Rate |
|---|---|
| Up to ₹1 crore | MCLR + 1.60% |
| ₹1–2 crores | MCLR + 2.10% |
| ₹2–5 crores | MCLR + 2.50% |
3. Based on Income Source
| Income Source | Loan Amount | Rate |
|---|---|---|
| Salary (>50% NMI) | Up to ₹1 crore | MCLR + 1.45% |
| Business/Rental (>50% NMI) | Up to ₹1 crore | MCLR + 2.10% |
4. Processing Fees & Charges
- Processing Fee: 1% of loan amount + applicable taxes, capped at ₹50,000
- Other Charges: Legal evaluation, technical assessments, and stamp duty
- Penalties: Late EMI payments attract penalties
- Prepayment: No penalty for early repayment—borrowers can reduce their burden anytime
Also Read: Eligibility for Loan Against Property
Security Requirements for Loan Against Property
At the core of LAP is the pledge of your owned property as collateral. Here’s what SBI usually asks for:
- Accepted Collateral: Equitable mortgage of clear title, non-agricultural, SERFAESI-compliant residential property
- Exclusions:
- Open plots
- Commercial/industrial properties
- Under-construction buildings
- Properties in rural/semi-urban areas (population below 1 lakh)
- Charge Restrictions: No second charge or pari-passu allowed with other lenders
- Loan-to-Value (LTV):
- Up to ₹1 crore: Max 65% of property value
- ₹1–5 crores: Max 60%
- The property valuation report must be under 3 months old
Key SBI Property Schemes for Individuals
In addition to LAP, SBI offers several property financing options designed for different borrower profiles and property needs. Here is a list of schemes provided by SBI related to property:
| Scheme | Purpose/Features | Property Relevance |
|---|---|---|
| LAP | Personal expenses (excluding speculation), max tenure 15 years | Leverages residential/commercial property |
| SBI Regular Home Loan | Standard housing finance: 0.5% lower interest for women | Home purchase |
| SBI Plot Loan | For land purchase | Plot acquisition |
| SBI Realty Home Loan | Buy a plot and construct later; loan up to ₹15 crore, term up to 10 years | Plot financing |
| SBI CRE Home Loan | For second/third home purchase (max 3 homes) | Multiple residential properties |
| SBI Flexipay Home Loan | Higher eligibility for salaried borrowers, interest-only during moratorium | New home purchase |
| SBI Pre-Approved Home Loan | Sanction before property finalisation | Enhanced negotiation power |
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Factors Affecting SBI’s Property Loan Terms
The loan conditions and interest rates aren’t fixed, as multiple borrower-specific and macroeconomic factors shape them, such as:
- Credit Score: A CIBIL score ≥800 unlocks the best interest rates. Scores between 550–649 result in higher charges.
- RBI Repo Rate: As SBI links floating rates to RBI’s repo rate, any change affects EMI amounts.
- Income Source & Stability: Salaried individuals typically get better rates than those relying on business or rental income.
- LTV Ratio: Lower LTVs mean better terms. High LTVs imply more risk to the lender.
- Loan Size & Tenure: Larger loans or longer tenures might attract slightly higher rates.
- Property Location: Prime urban properties are eligible for higher amounts. Remote or rural areas may be ineligible.
- Gender-Based Benefits: Women enjoy interest rate concessions in certain housing schemes.
Also Read: Loan Against Property
A Digital Bridge to SBI LAP
Navigating traditional loan processes can be time-consuming. The hassle of finding out which offers are best, which bank offers the best loan LTR, interest rates and a lot more.
That’s where BuddyLoan steps in—not as a lender but as a smart digital lending platform.
BuddyLoan simplifies the process by helping you compare offers, check eligibility in real-time, and apply digitally for most loans and other property-related loans. This is the way to go for speed, transparency, and convenience, so you get what you need without the red tape.
Also, use an EMI calculator so that you can know how much you are spending on repayment.
Conclusion
Your property can be a powerful financial tool waiting to be tapped. SBI’s Loan Against Property offers a well-structured, low-interest option to access sizeable funds without compromising ownership. When supported by tools like BuddyLoan, the entire borrowing experience becomes seamless, digital, and efficient.
Whether you’re planning for a milestone or managing unforeseen expenses, unlocking your property’s potential through SBI could be your smartest financial move yet.
And before you move on to applying for any credit, make sure to check your credit score so that you can have an idea of what to expect and plan accordingly.
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