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Is Home Loan and Loan Against Property the Same?

Having a home is a dream for many. Owning a property requires arranging a huge amount of funds. One tends to arrange the maximum funds possible from their own sources. Since the requirement is high, to meet the shortage of funds, one generally plans for a loan. First-time borrowers willing to apply for a loan confuse between loan against property and home loan. Although they both sound the same however the concepts of both the loans are different.

Serial NumberParameterHome LoanLoan Against Property
1Purpose of LoanHome Loan is availed for acquisition of new asset or modification of existing home.Loan Against property as the name suggests is given against a preowned property
2Interest RateHome loan rates are as low as 6.65%LAP rates begin at 7.50%
3Processing Fee0.25% to 1% of the loan amount plus GSTThe processing fee ranges between 1% to 2.5% of loan amount plus GST
4TenureThe Maximum tenure can be as high as 30 yearsThe loan can be taken for a maximum tenure of 15 years
5Eligibility CriteriaHome loan is given to salaried and self employed both.LAP is preferred to Self employed individuals
6Approval CriteriaThe Income and, property value and repayment historyProperty value is given preference while approving LAP
7Tax BenefitUnder section 80 (C) & 24 (D) tax benefit can be availedThere is no tax benefit on Loan against property
8CollateralOnly residential house, flat or land is kept as collateralResidential , commercial and industrial properties can be used as Collateral.
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Personal Loan Interest Rates October 2021
Fullerton India14.00% - 24.00%
HDFC Bank10.25% - 17.00%
ICICI Bank10.50% - 17.50%
IndusInd Bank11.00% - 23.00%
Kotak Bank10.75%
RBL17.50% - 26.00%
Standard Chartered Bank11.00% - 12.50%
Tata Capital10.49% - 14.25%
Home Loan Interest Rates October 2021
Axis Bank6.75% - 7.20%
Bank of Baroda6.75% - 8.25%
Citibank6.65% - 7.40%
HDFC6.70% - 8.00%
ICICI Bank6.70% - 7.55%
Indiabulls Housing Finance Limited8.65%
Kotak Bank6.50% - 7.25%
LIC Housing6.66% - 7.90%
Piramal Capital & Housing Finance9.65%
PNB Housing Finance7.20% - 8.90%
Reliance Home Finance8.75% - 14.00%
State Bank of India/SBI6.70% - 6.90%
Tata Capital6.90% - 8.75%