{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/www.indusind.com\/iblogs\/manage-your-finance\/how-is-loan-against-property-different-from-home-loan\/#BlogPosting","mainEntityOfPage":"https:\/\/www.indusind.com\/iblogs\/manage-your-finance\/how-is-loan-against-property-different-from-home-loan\/","headline":"How is Loan Against Property Different from Home Loan?","name":"How is Loan Against Property Different from Home Loan?","description":"While a loan against property enables borrowers to use their owned property as collateral for obtaining a loan, a home loan is specifically designed to facilitate the purchase of a new property. When financing a dream home or major expenses, two common options often come to mind: Loan Against Property (LAP) and Home Loan. While...","datePublished":"2023-07-29","dateModified":"2023-07-31","author":{"@type":"Person","@id":"https:\/\/www.indusind.com\/iblogs\/author\/indusind\/#Person","name":"IndusInd Bank","url":"https:\/\/www.indusind.com\/iblogs\/author\/indusind\/","image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/8169561f34fb61e737060f1a537a86e2?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/8169561f34fb61e737060f1a537a86e2?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"IndusInd","logo":{"@type":"ImageObject","@id":"https:\/\/www.indusind.com\/iblogs\/wp-content\/uploads\/logo-2.png","url":"https:\/\/www.indusind.com\/iblogs\/wp-content\/uploads\/logo-2.png","width":201,"height":86}},"image":{"@type":"ImageObject","@id":"https:\/\/www.indusind.com\/iblogs\/wp-content\/uploads\/home-loan.jpg","url":"https:\/\/www.indusind.com\/iblogs\/wp-content\/uploads\/home-loan.jpg","height":400,"width":1060},"url":"https:\/\/www.indusind.com\/iblogs\/manage-your-finance\/how-is-loan-against-property-different-from-home-loan\/","about":["Manage your Finance"],"wordCount":990,"keywords":["Home Loan","Loan against property"],"articleBody":"While a loan against property enables borrowers to use their owned property as collateral for obtaining a loan, a home loan is specifically designed to facilitate the purchase of a new property.When financing a dream home or major expenses, two common options often come to mind: Loan Against Property (LAP) and Home Loan. While both involve property assets, they serve distinct purposes and come with unique features and benefits. Understanding the key differences between them is crucial for making informed decisions about the suitable option for your financial needs. Keep reading to learn more about these two types of loans and the major differences between them.What Is a Loan Against Property?A loan against property allows you to meet financial needs for a significant life event, finance a business, or pay for a medical emergency. To obtain this secured loan, you must mortgage your property as collateral. You must repay the loan amount and the applicable interest rate in monthly instalments. It is important to note that if you cannot repay the loan, the lender has the right to sell your property to recover their investment.What Is a Home Loan?A home loan enables you to buy a new home, an under-construction property, or a plot of land for building your house. The lender will charge you a fixed or floating interest rate, and you must repay the loan in monthly EMIs. Throughout the repayment period, the lender will be the legal property owner, but once you pay off the EMIs, the ownership is officially transferred to you.Loan Against Property vs Home LoanThe table below enumerates the key differences between an LAP and Home Loan: Loan Against PropertyHome LoanPurposeCan be used for any personal and business reason, such as business expansion, funding children\u2019s education, medical expenses, or weddings.Can be used to purchase a home, plot, or property under construction.Loan-to-Value RatioUp to 80% of the property\u2019s market value.Up to 90% of the property\u2019s market value.Maximum TenureUp to 20 yearsUp to 30 yearsTax ExemptionUnder Section 24(B), salaried individuals can get tax deductions up to Rs. 2 lakhs on the interest payments of a loan used for buying a new residential house. Under Section 37(1), tax deductions on interest charges, processing fees, and documentation fees can be availed on LAP used for business purposes.Tax exemption as per Section 24 and Section 80C of the Income Tax Act for the interest paid and the actual principal amount, respectively.Why Should You Choose IndusInd Bank for a Loan Against Property or a Home Loan?IndusInd Bank offers several compelling reasons for you to choose it for a loan against property as well as a home loan:Loan Against Property BenefitsIndusInd Bank offers a higher loan amount to accommodate your personal or business needsGuarantees a faster mode of raising immediate long-term fundsBrings financial solutions directly to you with a doorstep banking facility, saving time and effortAllows you to repay your loan over a convenient 20-year periodHome Loan BenefitsAffordable home loan options with an attractive interest rateDoorstep assistance with hassle-free and quick loan application processingTransparency with no hidden charges, ensuring a smooth journey to your dream homeThe balance transfer facility allows you to switch your existing home loan to IndusInd BankPrepayment facility offered without additional feesFinancial support for up to 30 yearsCustomised solutions for NRI customersUnlock the door to your dreams with IndusInd Bank! Apply for a hassle-free home loan or a loan against property online to secure your financial future.Disclaimer:\u00a0The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct\/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.Share This:"}