8 Factors Affecting Your Loan Against Property Eligibility

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A mortgage loan or loan against property is one of India’s most popular secured loan options. Almost any Indian citizen can apply for a low-interest, no-frills mortgage loan. 

The following sections discuss the top-8 factors that determine the eligibility of loans against property and ways to increase the eligibility. 

8 Factors That Determine The Eligibility of a Loan Against Property –

The following are some factors lenders consider while determining a borrower’s loan against property eligibility:

1. Tenure

The tenure affects loan against property eligibility directly. If you opt for an extended loan term, your EMI will be less. Hence, the lender may consider your loan as less risky. In contrast, if you opt for a shorter tenure, the lender may increase the rate to minimize the credit risk. 

So, if you want to increase your mortgage loan eligibility, it is wise to apply for an extended term.

2. Credit Score

The credit score is often a key determinant of loan against property eligibility. Indian lenders generally consider 750 and above as a healthy credit score. Although you may still apply for a mortgage loan if your credit score is lower, the lender will increase the rate to minimize the credit risk. 

Hence, if you want to increase the chances of a loan against property approval, try to increase the credit score before applying. 

3. Borrower’s Age

Indian lenders usually accept loans against property applications from people aged 21 and 60. However, the lower your age is towards the minimum threshold; the higher are often the chances of loan approval. Since young borrowers are more likely to repay on time and may avail of an extended-term loan, lenders do not mind relaxing their eligibility.   

So, if you want to get a low-interest loan, it is wise to apply when you are young. 

4. Nature of Income

While determining the loan against property eligibility, lenders also factor like the borrower’s income. For instance, the lender might be cautious if your income is sporadic or irregular since the risk will be higher. Similarly, salaried professionals often get lower interest rates than self-employed professionals. 

Hence, while availing of a loan against property, show your total income (income from all sources) to increase your eligibility. 

5. Documentation of the Pledged Asset

Since a loan against property is secured, lenders need clear documents. You may have to submit documents like the building plan, environmental clearance, title deed, etc., along with your loan application. If the lender finds any document missing or improper, they may reject the loan application summarily. 

6. Property Insurance

Although property insurance is not very popular in India, an insured property can work wonders for your loan against property eligibility. Lenders consider an insured property less risky than an uninsured property because the insurer might take over the payment if the borrower defaults. 

So, to increase your mortgage loan eligibility, you may consider getting it insured first.   

7. Loan Approval/ Rejection History 

Some borrowers apply for multiple loans without realizing that even a single rejection might affect their credit score negatively. Since lenders can find your loan approval/ rejection history easily, they might feel apprehensive about approving a loan if your loan history is replete with more rejections than approvals. 

Hence, if you want to increase your loan against property eligibility, refrain from applying for too many loans in a short time.

8. Loan Amount 

The loan amount has a direct bearing on the loan against property eligibility. If you apply for a higher loan amount than your repayment capability, the lender may feel cautious. 

Hence, it is wise to consult the lender to understand your eligibility before applying for a loan against a property.


Now that you know the factors that affect a loan against property eligibility, applying for a loan must be easy. Evaluate the loan terms and interest rate before making the right choice.

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