Complete Features of land loan: From the perfect lot to acres of hunting ground, our land loans help you stake your claim. You’ll get great rates and no annual maintenance fees. A land loan, also known as a plot loan, is a type of loan offered by banks and non-banking financial companies (NBFCs) to help individuals or businesses purchase land. These loans are specifically designed for purchasing land for various purposes, such as constructing a house, building a commercial property, or even real estate investment.
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Complete Features of land loan
Eligibility
- 1. All Indian citizens of above 21 years are eligible for getting a land loan from banks and nonbanking financial institutions.
- 2. Some financial institutions and banks offer Land loans to nonresident Indians also bit the terms and conditions are some more complex than that of to Indians.
- 3. Both salaried and self employed individuals can get land loans.
Key Features
- Purpose: Purchase of land for residential or commercial use
- Loan amount: Typically up to 70% of the land’s market value
- Loan term: Can range from 15 to 20 years, with some lenders offering up to 30 years for specific loan schemes
- Interest rates: Generally higher than home loans
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Conditions to be fulfilled before applying
One should make sure that the plot of land that you are seeking to purchase using the land loan amount is a residential plot and not an agricultural or commercial land and comes within the corporation / municipality limits.
Maximum amount of loan that can be sanctioned
1.In urban areas maximum 70% of total value of the plot of land you are going to buy can be sanctioned as land loan.
2.For small cities and all it is only 50% i.e., one has to procure the balance amount from another source and can further proceed to loan application.
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Tax benefits
Land loan is not eligible for deduction from income while calculating the taxable income. It is not a traditional home loan.But if you start construction of home in the plot of land you bought through the loan then it can be used to get deduction like home loan that too in the year of completion of construction.
Documents required
- 1. Proof of identity
- 2. Proof of address
- 3. Salary statements in case of salaried employees and bank statements of last 6 months or 1 year depends on the banker’s order.
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4. All site ownership documents in the name of your seller, to the concerned bank or NBFC. This includes no encumbrance certificate, possession certificate, location certificate and back documents of last 15 years.
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