Can we get a loan against property without income proof?

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17 Aug 2020: Everybody experiences a financial crisis at least once in their lifetime. There is a never-ending list of things that require monetary aid for fulfilment. And there are scenarios where you will need instant access to surplus funds. During such times, the majority of the people go for a loan against their property. This is the best way to put your house into work to get your things done. However, people have specific queries regarding availing a loan against property. The most frequently asked question is, can we get a LAP without income proof.

Sadly, the loan against property eligibility requires you to include income proof in your documentation. This is true with the leading lenders in India. However, there are some lenders who are willing to give you a loan against property without income proof. Let’s see how.

#1 Elaborate your income or source of income to the lender 

If you don’t have an income proof or an ITR, the lender will ask for your income source. You will have to specify your source of income, including the reasons why you don’t possess the necessary documents for the loan. The lender asks for income proof because your monthly repayment amount is fixed based on that. And if you don’t have an income proof, it tells the lender that you don’t have a stable source of income. If you are able to convince the lender that you earn regularly, they might sanction you the LPA.

#2 Go for a loan to value (LTV)

Loan to value or LTV ratio is the percentage of your house’s market value offered as a loan by the lending institution. For example, a high LTV of 80% provided by the lending institution means that only 20% of remaining expenses are to be met by you. If you don’t have an income proof to show, making a higher down payment and getting a lower LTV will improve your chances of getting your loan against property approved. Most importantly, this type of intervention tells positive borrower credibility. However, not all lenders provide the LAP under this policy.

#3 Apply with a co-applicant 

The easiest way to get a LAP loan without income proof is to apply with a co-applicant. If your spouse or anyone else from your family is earning and has a valid income proof, you can apply for the loan against property. This is the preferred choice for many borrowers as it not only lessens the burden on monthly payments but also enables them to avail the loan without showing any proof of income.

#4 Keep a tab on your savings 

The lender will need proof that you will repay the monthly instalments on time. For this, you will have to maintain a high average monthly balance as well as regular savings. This will improve your chances of getting a LAP without showing the proof of income.

There are many lenders that provide LAP without income proof. You may have to do some research before choosing your lender.