A home loan allows you to acquire or construct a property, while a loan against property lets you use an existing property as collateral to secure funds. A loan against property or mortgage loan can help you manage personal financial emergencies.
Although both loans involve property, their interest rates and charges may vary. Understanding these differences helps you make informed financial decisions.
ICICI Bank offers flexible and competitive loan options to suit your financial needs. Whether you are buying or building your dream home with a home loan or pledging your property for a loan against property, ICICI Bank offers solutions for both planned and unexpected expenses.
ICICI Bank Home Loan
ICICI Bank offers home loans of up to ₹5 Crores with interest rates starting from 8.75% per annum. This rate is not fixed, as the lender determines it based on the applicant’s credit score and employment status. The loan amount is also influenced by these factors.
Applications can be submitted online through the official ICICI Bank website or via the iMobile app.
Eligibility Criteria
● Nationality: Indian
● Age: 20 to 65 years (salaried), 21 to 70 years (self-employed)
● Monthly Income: Minimum salary of ₹ 25,000
● Employment Stability: Stable business track record for self-employed
● Credit Score: 700 and above
Documents Required
Self-employed individuals need to submit some additional documents compared to the salaried individuals. Here is what you need to submit depending on your occupation type:
For Salaried Applicants:
● Signed application form with photograph
● Proof of identity, residence, and age
● Last 6 months’ bank statements
● Last 3 months’ salary slips
● Form 16 or Income Tax Returns
● Processing fee cheque
For Self-employed Applicants:
● Signed application form with photograph
● Proof of identity, residence, and age
● Proof of business existence
● Education qualification certificate (if applicable)
● Last 6 months’ bank statements
● Last 3 years’ Income Tax Returns with income details
● Last 3 years’ audited Balance Sheet & Profit & Loss Account
● Form 16 or Income Tax Returns
● Processing fee cheque
In addition, you can apply for a balance transfer facility. ICICI Bank home loan balance transfer interest rates are subject to change as per terms and conditions of the financial institution.
ICICI Bank Loan Against Property
ICICI Bank offers financial support through loans against property or mortgage loans with interest rates starting from 10.85% per annum. The loan amount and interest rate depend on the applicant’s profile. You can get a substantial loan amount with a repayment period of up to 15 years.
Eligibility Criteria
● Age: 25 to 65 years or retirement age
● Employment: Salaried and self-employed individuals
Documents Required
Here are the requirements for a mortgage loan:
Individual Applicants:
● Identity and Address Proof: Aadhaar, Passport, Driving License, Voter ID, NREGA Card, or NPR Letter
● DOB Proof: Passport, Driving License, Voter ID, NREGA Card, or NPR Letter
● Income Proof: Latest Form 16, 1-month salary slip, last 6 months' bank statements
Non-individual Applicants (Entities):
● Identity Proof: Registration Certificate (e.g., Udyam, Shop License, Sales Tax/Income Tax returns)
● Address Proof: GST Certificate, Business Registration, Utility Bill, Rent Agreement (with utility bill)
● Income Proof: Last 6 months' bank statements, 2 years' CA-certified ITRs, Profit and Loss Statement, GST returns for the past year
ICICI Bank Home Loan vs Loan against Property
A home loan and a loan against property serve different purposes and have distinct features. Here is a comparison highlighting the key differences between the two:
| Aspect | Home Loan | Loan Against Property |
|---|---|---|
| Loan to Value | Based on credit score, income status, and income proof | Primarily depends on property value |
| Usage | Specifically for home purchase or construction | Can be used for various personal financial needs |
| Tenure | Up to 30 years | Up to 15 years |
| Documents | Standard loan documents required | Property and residency details needed; property evaluation conducted before loan approval |
Conclusion
Your decision between a home loan and loan against property depends on your financial requirements. A loan against property is suitable for addressing significant personal or business expenses. However, a home loan is appropriate for purchasing or renovating a house.
When choosing a loan, you need to assess your financial position, repayment capacity, and intended purpose. Home loans generally have lower interest rates and extended repayment tenures. That makes them more suitable for property acquisition or construction. A loan against property provides greater flexibility in fund utilisation.
It is, thus, a viable option for various financial needs. Review the interest rates, processing fees, etc. before you apply to ensure the loan aligns with your financial objectives. Effective financial planning and timely repayments contribute to maintaining a strong credit profile. This enhances your future borrowing opportunities on favourable terms.
Frequently Asked Questions
What is the interest rate of an ICICI Bank loan against property?
The ICICI Bank loan against property interest rate starts from 10.85% per annum. However, this rate is not fixed for all applicants. The final interest rate and loan amount depend on factors such as income status and property value.
Is it good to take a loan against property?
A loan against property can provide financial support when funds are required urgently. However, this is a long-term financial commitment that requires careful consideration. A steady income flow is necessary to ensure timely interest payments and avoid financial strain.
What is ICICI Bank's home loan interest rate?
ICICI Bank offers home loans with interest rates starting from 8.75% per annum. The final rate depends on credit score, employment type, and repayment history. A high credit score and stable income can help secure a lower interest rate and higher loan amount.
Is ICICI Bank best for home loans?
ICICI Bank provides competitive interest rates, and flexible repayment options. The processing fee and other associated charges remain minimal, making it a suitable option for home financing.
Disclaimer: This article is published in association with Bajaj Finserv and not created by TNM Editorial.