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Loan Against Property

Every RBI rule that touches Loan Against Property, simplified for bankers. 0 published.

OverviewLoan Against Property (LAP) lets a borrower pledge owned residential or commercial property to raise funds for any purpose. For lenders it is a secured retail product, so the RBI rulebook around it spans fair-practices conduct, valuation and loan-to-value discipline, interest-rate transparency under the external-benchmark and Key Facts Statement regime, and recovery and foreclosure norms. Because LAP sits at the intersection of secured lending and consumer protection, banks and NBFCs have to track several regulatory threads at once.
Key dataSee the numbers behind Loan Against Property: NPA / Asset-Quality Tracker — gross & net NPA / asset-quality trends, updated from official RBI data. Related live data: Bank Health Scores.
Key termsPlain-English definitions of the terms on this page — see the full Indian banking glossary. External Benchmark Lending Rate (EBLR) · Key Facts Statement (KFS) · Gross NPA (GNPA) · Special Mention Account (SMA) · SARFAESI
Part of clusterThis topic is part of the Retail & Secured Lending cluster — explore related rules, FAQs and live data across the theme.

Latest circulars in this cluster

No circulars in this section yet — the engine is processing RBI history; check back soon.

Frequently asked questions

What RBI rules apply most directly to Loan Against Property?

LAP is governed mainly through the fair lending practices code, interest-rate and Key Facts Statement transparency requirements, valuation and prudential norms for secured exposures, and the rules on penal charges, foreclosure and resetting of floating rates. The exact obligations differ slightly between banks, HFCs and NBFCs.

Is there a fixed loan-to-value cap for LAP?

RBI does not publish a single universal LAP loan-to-value figure the way it does for some products; lenders set LTV within their board-approved credit policy and prudential limits, supported by an independent valuation. Always confirm against the latest applicable circular linked on each page below.

What changed recently for LAP borrowers?

The biggest shifts in recent years have been around transparent pricing — the Key Facts Statement, clearer rules on penal charges versus penal interest, and the borrower's right to switch to a fixed rate or foreclose floating-rate loans. The cluster pages below track each change with its official source.

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