Loan against property (LAP), as the name implies, explains that a property is the collateral in the loan.

This loan is an equitable mortgage by Memorandum of Entry by way of deposit of title deeds and/or such other collateral security, as may be necessary. Collateral security, by way of assignment of insurance policy or any such other assignable financial instruments are also required, as security to the loan if deemed necessary by the bank or the non-banking finance company (NBFC).

Please do ensure that the title to the property is clear, marketable and that it doesn’t have any existing loan or litigation over it as that will hinder the process of taking a loan.