Banks and NBFCs offer loans covering 60% to 80% of the land's value, ranging from ₹25 lakh to ₹15 crore. Interest rates vary between 8.6% and 17% annually, with loan tenures spanning 5 to 20 years. Salaried individuals must earn at least ₹10,000 per month, while self-employed applicants need a minimum annual income of ₹2 lakh. Tax benefits apply only when combined with a home loan.
What is a Land Purchase Loan?
With real estate prices soaring, buying land—especially in metro and Tier-1 cities—has become challenging. Land purchase loans help individuals acquire residential plots. Unlike home loans, these are secured loans but come with higher interest rates. Borrowers can avail of loan tenures between 5 to 20 years, with EMI amounts typically higher than home loans.
Loan Amount and Eligibility
Lenders generally finance 60% to 80% of the land’s value, requiring buyers to contribute the remaining 20% to 40%. Loan amounts can range from ₹25 lakh to ₹15 crore, depending on factors like location, credit score, and repayment capacity.
Who Can Apply?
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Applicants must be aged between 21 and 65 years.
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Salaried individuals need a minimum monthly income of ₹10,000.
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Self-employed individuals should have an annual income of at least ₹2 lakh.
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A good credit score improves loan approval chances.
When is a Land Loan Beneficial?
If you plan to build a house, a home loan might be a better option. However, if you are purchasing land as an investment, a land loan is a viable choice. Tax savings do not apply directly, but tax benefits can be availed if combined with a home loan.
Steps to Apply for a Land Loan
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Check Eligibility – Ensure you meet the age, income, and credit score requirements.
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Compare Lenders – Analyze interest rates and terms from various banks and NBFCs.
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Prepare Documents – Submit identity proof, address proof, bank statements, income tax returns, land title deed, and legal reports.
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Apply for the Loan – Fill out the application form with the chosen lender.
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Approval & Disbursement – Once verified, the loan amount will be transferred to your account.
