How to Get a Loan on a Home?

A loan on a home, also called a loan against property, is different from a regular home purchase loan. Here, you already own the house, and you pledge it as collateral to borrow funds for any legitimate purpose. Most lenders hold the property papers until you repay, and in case of default, they have the right to sell the property to recover dues.

Before you learn how to take a loan against house funds, check if you qualify. Most lenders look at a few consistent factors.

• Age between 21 and 65 years at loan maturity

• Steady income, whether salaried or self-employed

• A clear property title, free from legal disputes

• A credit score of 700 or above, ideally

• Limited existing debt obligations

Keep these ready before applying:

• Identity proof (PAN, Aadhaar)

• Address proof

• Income proof (salary slips or ITRs)

• Bank statements for the last six months

• Property documents including the sale deed and tax receipts.

1. Fill out the application form with personal, income, and property details.

2. Submit your documents for verification, both financial and property-related.

3. Property valuation is conducted by the lender to assess its current market value.

4. Eligibility check based on income, credit score, and repayment capacity follows next.

5. Sanction letter is issued once your application clears these checks, stating the approved amount and terms.

6. Legal and technical verification of the property is done to confirm clear ownership.

7. Loan disbursal happens after you sign the agreement, with funds credited to your account.

Most lenders complete this within 1-2 weeks, though it can stretch longer if property verification throws up complications.

This is the part that is missed out by most articles; however, this is something which is way more important than we realize. Usually, lenders provide a loan which accounts for 60-70% of the current market price of the property, and this is referred to as “loan-to-value ratio”. This just means that if you have a property valued at ₹80 lakh, then you will get a loan between ₹48 lakh to ₹56 lakh and not the total value of the property.

Residential properties usually fetch a higher LTV than commercial ones. Knowing this upfront helps you set realistic expectations before you even apply, rather than being surprised at the sanction stage.

Learning how to take a loan against house funds successfully also means understanding what can work against you. A low credit score, an unclear property title, or a high existing debt-to-income ratio are the most common reasons applications get rejected or reduced in amount.

Co-owned properties can also slow things down if all owners aren't equally involved in the application. Keeping your paperwork clean and your existing debts manageable goes a long way here.

Once you know how to get a loan on a home, the harder part is picking the right lender for it, since rates, LTV ratios, and processing timelines vary quite a bit across banks and NBFCs. BASIC Home Loan works as your advisor here, helping you compare options and understand which one suits your property type and repayment comfort, so you're not left comparing different websites on your own.

The right lender can make all the difference, and with the right support, getting a home loan feels a lot less complicated.