Loan Against Property vs Home Loan - What's the Difference?
Many people confuse Loan Against Property (LAP) with Home Loan, but they serve very different purposes. Let's simplify the key differences.
Home Loan
Used to buy or construct a house.
- Lower interest rates
- Long tenure (up to 30 years)
- Limited usage (property purchase only)
Loan Against Property (LAP)
Loan taken against an existing property.
- Can be used for business, education, medical needs
- Higher loan amount possible
- Flexible usage
Comparison Table
| Feature | Home Loan | LAP |
|---|---|---|
| Purpose | Buy house | Any purpose |
| Interest Rate | Lower | Slightly higher |
| Tenure | Up to 30 years | Up to 15 years |
| Flexibility | Low | High |
Choose LAP If:
- You need business capital
- You want large funding
- You already own property
