Axis Bank Loan Against Property - Frequently Asked Questions

What is the turnaround time for decisioning a Loan Against Property application?
Axis Bank will convey its decision within 30 working days from the date of receipt of the application provided the application is complete in all respects. The computation of 30 days shall starts from the day on which all documents required for a proper appraisal of the application are provided by the Customer to bank.
Why should I opt for a Loan Against Property instead of a Top-up Loan?
A Loan Against Property (LAP) has many advantages over a Top-up Loan. They include:
A Higher Loan Amount: Typically, an LAP may offer a higher loan amount than a Top-up Loan.
Avail of Different Property: While an LAP can be availed of against a different residential or commercial property than the one for which the loan was originally taken, a Top-up Loan may only be taken against the property already in question. This flexibility allows you to both avail of a higher loan amount and spread your liability.
Longer tenure: An LAP can be availed for a long term than a Top-up Loan.
What is the different property types considered under the Loan Against Property scheme?
Axis Bank Loan Against Property can be availed for a self-occupied residence or a commercial property.
What is the minimum and maximum amount of Loan Against Property that I can get?
At Axis Bank, you can get a Loan Against Property from Rs. 2 lakhs to Rs. 500 lakhs. Some of the factors we consider when deciding a loan amount are:

  • The property’s registration
  • The property’s market value
  • Your requirement and eligibility
  • Your income and repayment capacity

Can I get an overdraft against my property?
Yes! An Axis Bank Loan Against Property can be availed of either as a Term Loan with an EMI repayment option or as a Drop-line Overdraft Facility.
I am an NRI. Can I get a Loan Against Property?
Yes! Axis Bank provides LAPs for salaried NRI customers.
What documents do I need to submit along with my application for an Axis Bank Loan Against Property?
Along with your application you need to submit the following documents :

  • Proof of residence
  • Proof of identity
  • Certified/latest financial documents
  • Copies of all property documents

Is it mandatory to have a co-applicant when applying for a Home Loan? If yes, who can be a co-applicant for my Home Loan?
Yes, it is mandatory to have a co-applicant. If someone is the co-owner of the property in question, it is necessary that he/she also be the co-applicant for the Home Loan. If you are the sole owner of the property, any member of your immediate family can be your co-applicant.
Do I need to pay a fee to avail a Loan Against Property?
Yes, banks charge a non-refundable processing fee for every LAP application. The processing charge to avail of an Axis Bank Loan Against Property is up to 1% of the loan amount plus service tax as applicable
How will my Equated Monthly Installment (EMI) be calculated?
The EMI consists of the principal amount and the interest on the principal amount. It is calculated by taking into account the loan amount, the time frame for repaying the loan and the interest rate on the borrowed sum. The EMI may be subject to change when interest rate changes or a part-payment of the Loan is made.
Every month, part of the EMI is adjusted towards the interest payable and the balance is adjusted towards repayment of the principal.
When is my EMI due?
The EMI will be due on a fixed date each month. You will be notified of this date when your loan amount is disbursed.
Can I make a part-prepayment towards my Axis Bank Home Loan? Will any charge be applicable?
Yes! After the first quarter from the loan disbursal date, you can make a part-prepayment towards your Loan Against Property at your nearest Axis Bank Loan Center.
What are my different options for making my EMI payments? Is there a preferred one?
You may repay your Axis Bank Loan Against Property in any of the following three ways:
Standing Instruction (SI): This mode can be used if you have an existing savings, salary, or current account with Axis Bank. You may wish to open a savings account with Axis Bank to use this option. Your EMI amount will be debited automatically at the end of the monthly cycle from the Axis Bank account you specify.
Electronic Clearing Service (ECS): This mode can be used if you have a non-Axis Bank account and would like your EMIs to be debited automatically at the end of the monthly cycle from this account.
Post-Dated Cheques (PDCs) : You can submit post-dated EMI cheques from a non-Axis Bank account at your nearest Axis Bank Loan Center. A fresh set of PDCs will have to be submitted in a timely manner. Please note Post Dated Cheques will be collected non-ECS locations only.

We recommend that you opt for either the SI or ECS mode of payment as they are both faster and less prone to error than the use of PDCs.
How do I foreclose my Loan Against Property? Will there be any charge for the foreclosure?
Before we process a foreclosure, all outstanding dues must be cleared. So we request you to first check for and clear any remaining amount that may be payable towards your Home Loan by requesting a foreclosure statement from your nearest Axis Bank Loan Center.
Once all outstanding dues have been cleared, please submit a foreclosure request at the Loan Center, and we will begin processing your request.
What is MCLR?
MCLR stands for Marginal Cost of Funds based Lending Rate.
MCLR is the benchmark rate below which the banks cannot provide loans to the customers who are availing loans linked to MCLR. This new benchmark rate is applicable for new loans sanctioned & credit limit renewed from April 1, 2016 onwards.
What are the various types of benchmark under MCLR?
Currently, the Bank has published the following MCLR:

  • Overnight MCLR
  • One-month MCLR
  • Three-month MCLR
  • Six month MCLR
  • One year MCLR
  • Two year MCLR
  • Three year MCLR

What is the benchmark MCLR applicable for AXIS Home / Loan against property (LAP) loans and what would be the reset period for AXIS Bank Home / LAP Loans?
The benchmark MCLR for Axis Home/ LAP loans is 6 months. The reset period would be every 6 months.             
Will MCLR be different between Banks?
Yes, MCLR can be different between different banks as it will depend on marginal cost of funds, negative carry on account of CRR, operating costs, tenor premium of respective banks.
What does periodicity of reset means?
Banks can specify dates of interest reset which will be linked to either the date of first disbursement or date of review of MCLR. The MCLR prevailing on the day the loan is disbursed will be applicable till the next reset date, irrespective of the changes in the benchmark in the interim. The exact periodicity of reset will form part of the terms of the loan contract. 
For example, if the periodicity of reset is Six Months, then Home loan/ LAP loans disbursed in the month of April 2016, would be due for reset in the month of Oct 2016 similarly all such loans disbursed in the month of May 2016 would be due for reset in the Nov 2016 and so on.
When will be the reset date decided for the loan? How will the reset impact the current rate of interest (ROI) in case the MCLR increases or decreases?
The reset period and date will be decided on the date of first disbursement.
In case of increase in MCLR on the reset date, the ROI will increase which in turn will impact the EMI/tenor of the loan as per Bank’s policy and will be communicated to the customer.
In case of decrease in MCLR on the reset date, the ROI will decrease which in turn will impact the EMI/tenor of the loan as per Bank’s policy and will be communicated to the customer.
It may be mentioned that the spread/margin of the loan would continue to remain the same.
Illustration: Consider a scenario where first disbursement of the loan is done on April 15, 2016 under MCLR-6 month’s benchmark rate, with the 6 months MCLR being 9.20% p.a. with a spread/margin of 20 basis points (bps). In such a case the effective rate would be 9.40% p.a.
In the above scenario, the effective rate of 9.40% p.a. would remain constant till the next reset date i.e Oct 2016.
On Oct 2016, the loans would be reset with the applicable 6 months MCLR rate as on that date.
It may be mentioned that the spread/margin of the loan would continue to remain the same. e.g. If the 6 months MCLR is 9.10% p.a. as on OCT 2016, then revised rate applicable for the loan would be 9.10% + 0.20% = 9.30% p.a. w.e.f. Oct 2016.
If a loan is partly disbursed and earlier rate is linked to Base Rate, which benchmark (Base rate OR MCLR) would be applicable for subsequent disbursements?
All existing loans linked to the Base Rate will continue till its repayment. All existing borrowers will, however, have the option to shift to the MCLR linked loan at mutually acceptable terms

Thus, in case of partly disbursed loan, for subsequent disbursements, the Base rate will continue to be applicable, provided the borrower does not exercise the option to move to the MCLR linked loan at mutually acceptable terms
Will AXIS Bank discontinue the current benchmark rates BR/MRR/BPLR?
(BR= Base rate, MRR= Mortgage reference rate, BPLR = Bank prime lending rate)

For all new loans sanctioned from April 1, 2016, the Bank has discontinued offering loans linked with Base rate/MRR/BPLR. However, the existing loans will continue on the respective BR/MRRR/BPLR till its repayment, provided the borrower does not exercise the option to move to the MCLR linked loan at mutually acceptable terms.
Will the existing customers linked to BR/MRR/BPLR Base based benchmark rate be allowed to migrate to MCLR based pricing without change in effective rate of interest?
All existing customers have an option to switch from the existing system of Base rate/MRR/BPLR (BR/BPLR/MRR +/- spread) to the new system of 6 months MCLR (MCLR + spread) without changing the effective rate of interest. No switch fee would be charged for this option. The effect of conversion in the system, from existing system of BR/MRR/ BPLR to new system of 6 months MCLR, will be provided on an immediate basis. 
Illustration: If an existing customer with loan amount of ₹ 25,00,000/- is at 9.55% p.a. effective ROI (Base + 0.20% spread) and if the customer opts to switch-over to 6 months MCLR then the Adjustable Rate Home Loan interest rate will become (6 months MCLR (9.20%) + spread (0.35%)) equivalent to 9.55% p.a.. 
Thus, the effective rate will continue to remain same at 9.55% p.a. with spread applicable on the loan being adjusted.
What is the process for changing from an existing benchmark rate of BR/MRR/BPLR to MCLR benchmark rate?
For changing from existing bench mark rate of BR/MRR/BPLR to MCLR-Six Months based benchmark rate, the customer will be required to visit the nearest loan Center, execute an agreement for conversion into MCLR Six month’s benchmark rate.
What are my different options for making my EMI payments? Is there a preferred one?
You may repay your Axis Bank Loan Against Property in any of the following three ways: 
Standing Instruction (SI): This mode can be used if you have an existing savings, salary, or current account with Axis Bank. You may wish to open a savings account with Axis Bank to use this option. Your EMI amount will be debited automatically at the end of the monthly cycle from the Axis Bank account you specify. 

National Automated Clearing House (NACH): This mode can be used if you have a non-Axis Bank account and would like your EMIs to be debited automatically at the end of the monthly cycle from this account. 
We recommend that you opt for either the SI or NACH mode of payment as they are both faster and less prone to error than the use of PDCs.

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