The right customer
- Self-employed owners who need larger funds than an unsecured loan allows
- Owners with a clear, self-occupied residential or commercial property
- Customers consolidating several expensive loans
What lenders look for
- Banks offer the best rates for clean titles and documented income.
- HFCs and NBFCs accept more varied properties and income types.
- Small finance banks cover smaller towns and informal income.
Documents to collect
- Title deed and full chain of documents
- Approved plan and latest property-tax receipt
- Income proof and 12 months of bank statements
- Existing loan statements
Common rejection reasons
- Break in the title chain
- Valuation well below the customer's expectation
- Unauthorised construction or a missing approval
- Income that cannot support the EMI
- Property in a location the lender does not fund
A worked example
Illustrative case
Customer: manufacturer, owns a ₹1.5 crore shop, needs ₹80 lakh.
At 60 % loan-to-value, the property supports up to ₹90 lakh; income then decides the final amount.
Illustrative payout at 0.75 % of ₹80 lakh: ₹60,000.