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Union Bank of India Loan Against Property

Union Bank of India
4.5

Union Bank of India, commonly referred to as Union Bank or UBI, is an Indian government-owned bank with 120+ million customers and a total business of US$106 billion

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Interest Rate

Processing Fee

Rating

Loan Amount/Tenure

Union Bank of India Loan against property Interest Rate

Union Bank of India

10.25% - 12.9%

Up to 0.5%

4.5

₹25L - ₹75L

Tenure(1 - 12 Years)

Details

Features and Benefits of Union Bank of India Loan Against Property

Union Bank is among India's largest public sector banks that offer individual and corporate loans against property. The Union Bank of India LAP interest rate ranges between 12.05% to 12.90% based on the applicant's property type and CIBIL score. A borrower can avail of a loan amount of up to INR 10 crores if they meet the Union Bank of India Loan Against Property eligibility criteria. There is an availability of an overdraft facility under liquidity finance.

The features and benefits of the Union Bank of India loan against property are below:

  • The applicant's current property secures the loan.
  • Anything from business needs to educational necessities can be paid using the loan.
  • The costs are competitive.
  • Regular and overdraft loans are the types of loans offered.
  • Flexi of the applicant's bank; the loan account is linked to the current account.
  • Professionals living in India who are salaried, independent, or unemployed are eligible for the loan.
  • Large loan amounts of up to INR 10 crores for a maximum of 15 years
  • The application process is straightforward 
  • The customer service staff is committed to assisting the client's

Eligibility Criteria Union Bank of India Loan Against Property

An applicant must be aware of the Union Bank of India Loan Against Property requirements to apply for it. The following Union Bank of India loan against property eligibility criteria must be met.

  • Must be an Indian citizen 
  • Must have a regular source of income and own non-agricultural property
  • Must be between the ages of 18 and 75 years.
  • Both existing and new home loan borrowers are eligible

Factors Affecting Union Bank of India Loan Against Property Eligibility

The following factors affect Union Bank of India LAP eligibility:

Loan Amount

Your required loan amount and term are directly related. The loan amount typically rises as the loan term lengthens. Since the loan amount is dispersed over a longer period, the EMIs are lower, making loan repayment simpler. This eases the burden of repayment on your monthly spending plan.

Credit Score

Your credit score is essential in establishing your eligibility for a loan against property and the interest rates you will pay on your LAP loan. To qualify for competitive interest rates, your credit score must be at least 750.

Documentation

Before disbursing the loan, financial institutions will almost certainly check to see if you have the necessary documentation for the property, such as local authority approvals, environmental clearances, building plans, etc.

Age

This factor substantially impacts the borrower's ability to repay the debt. If the borrower has reached or will reach retirement age soon, there is a higher chance that your loan application will be rejected. In these situations, you can always look for loans with a shorter duration, although the EMI would be more significant.

Income Tax Returns 

Lenders frequently request self-employed applicants' most recent three years of income tax returns. Even if your income is significant, the lender won't be able to verify your reliable income in the lack of enough ITRs, which will lower your approval odds even if your income is high.

Union Bank of India Loan Against Property Interest Rates

An applicant must know the interest rates before applying for a Union Bank of India loan against property. There are two types of Union Bank of India LAP. The following are the interest rates of Union Mortgage and Union Mortgage Plus.

Union Mortgage

The Union Bank of India Loan Against Property interest rate is given in the table below:
Property Type (Excluding Open Plots) Interest Rate 
Residential Property (Self-occupied/Tenanted)
  • 700 and above CIBIL Score - 12.05%
  • Below 700 CIBIL Score - 12.15%
Non-Residential but self-occupied commercial/industrial properties
  • 700 and above CIBIL Score - 12.55%
  • Below 700 CIBIL Score - 12.65%
Non-Residential properties which are not self-occupied, hospital leased to third parties, Multi tenanted commercial building
  • 700 and above CIBIL Score - 12.80%
  • Below 700 CIBIL Score - 12.90%
Note: The interest rates mentioned above are as of December 2022.

Union Mortgage Plus

Union Bank of India LAP interest rate is given below:

  • 0.75% above the ROI of the Home Loan account against which the Mortgage Plus loan is extended without factoring in concession 
  • Borrowers with a CIBIL Score of below 700 are to be charged an additional borrower risk premium of 0.10% 
  • In the case of Staff Home loan borrowers, the applicable ROI for Union Mortgage PLUS will be 0.75% above the applicable ROI on the Union Home Loan Scheme.

Note: The interest rates mentioned above are as of December 2022.

Factors affecting Union Bank of India Loan Against Property Interest Rates

Many factors influence an interest rate of a loan against property. The following factors affect the Union Bank of India loan against property interest rates.

Type of Property

The property is inspected by surveyors employed by the lenders to determine its kind (whether residential or commercial), age, location, and market worth. The amount of the loan that can be accepted, the time frame for repaying the loan, and the interest rate that can be charged to the borrower are all determined by the lenders based on the surveyors' reports. Different loan amounts and interest rates apply to commercial and residential properties.

Loan Tenure

The interest rate that will be charged on loan is also based on how long it will be outstanding. Due to the lengthier repayment terms for these loans—roughly 15-20 years—the provided interest rate is lower. The borrower can choose a shorter tenure to pay off the loan sooner. But in these circumstances, the lender typically charges a higher interest rate on the loans backed by real estate.

Credit Score

When determining a borrower's eligibility and the interest rate that will apply to their loan, that person's credit score is crucial. Any score over 650 is considered sufficient to obtain competitive rates on loans secured by real estate. Because lenders view customers with low credit scores as high-risk, they approve loans for them at higher interest rates. Having a low credit score may also result in loan applications being turned down. 

External Factors

External factors such as the Reserve Bank of India's (RBI) monetary policy, inflation, and the rate of economic expansion may also impact interest rates. The intriguing thing is that every external factor influencing the LAP interest rate is somehow linked. If inflation rises, the RBI alters its monetary policy. It raises the repo rate and the Cash Reserve Ratio (CRR), raising borrowing costs. The RBI takes this action to control prices by limiting the flow of cash through the economy.

Simply put, if the economy suffers a setback, the cost of obtaining a loan against property rises.

Relationship With the Lender

The relationship between a borrower and their lender influences the interest rate. The lender's comprehension and trust improve the more prolonged a connection. You can qualify for a lower interest rate if you already have credit with the lender and make on-time payments on your loans. However, the lender may have a stringent credit evaluation procedure that raises the interest rate for new clients.

Union Bank of India Loan Against Property Fees and Charges

Some specific fees and charges must be paid by a borrower when they apply for a Union Bank of India loan against property. The bank charges the following processing fees to meet the loan's expenses.

Term Loan 1 % of the loan amount -Minimum INR 5000; Maximum INR 1 lakh For Staff Members: 0.25% of loan amount
Union Mortgage (secured overdraft) 0.25% of loan amount with no minimum charges; Maximum: INR 1 lakh For Staff: NIL

Note: The fees and charges mentioned above are as of December 2022.

Documents Required for Union Bank of India Loan Against Property

The documents required for Union Bank of India loan against property are below:

KYC Documents

  • Address Proof like passport, driving license, aadhaar card etc
  • Identity Proof like PAN card, aadhaar card, driving license etc.
  • Two passport-size photographs

Other Documents

  • Application form 
  • Credit Information
  • Last two years ITR/Form 16, latest 3 months salary slips, and proof of any other income (in case not mentioned in ITRs/Form 16) for salaried applicants
  • Last two year’s ITR and proof of other income (in case not mentioned in ITRs/Form 16) for non-salaried applicants
  • Last six months bank statements
  • Property documents include Agreement to sell/Allotment letter, copy of approved plan by local body, original Sale Deed/Title deed/ advance payment receipts or own contribution receipts, estimated cost of construction/extension/repairs/renovations, NOC from Developer/Builder/Society, Statutory and regulatory approval as per state laws

In The Case of a Take-over from Other Bank/Financial Institution:

  • Sanction letter
  • Last 12 months statement of account
  • Confidential credit report required from existing bank

In The Case of an NRI  

  • Employment contract/offer letter
  • Latest work permit
  • Passport copy
  • Local address proof, if any
  • Visa stamped on the passport
  • Identity card issued by current employer
  • The document attested by the respective Indian Embassy in case NRI borrowers execute a power of attorney (POA) abroad.

How Does the EMI Calculation Work for Union Bank of India Loan Against Property?

Applicants can use the IDBI Bank of India LAP calculator to calculate their Equated Monthly Instalments (EMIs). The following formula is used to calculate EMIs.

EMI = {P x R x (1 + R) ^ N} whole divided by { (1 + R) ^ N (N - 1) } Here, ‘P’ represents the Principal amount, ‘R’ represents the interest rate and ‘N’ means the loan tenure. 

How Does the Union Bank of India Compare With Other Lenders?

A borrower must do vigorous research when opting for a lender. This tedious task is made easy with the table below, comparing Union Bank of India Loan Against Property interest rates with other lenders.

Name of the Lender Interest Rate (% p.a.)
State Bank of India 10.00-10.70
Bank of Baroda 10.55-16.20
PNB Housing Finance 7.99-11.00
IDFC First Bank 8.40-15.90
HDFC Bank 9.00-11.90
L&T Housing Finance 9.40
LIC Housing Finance 9.10-12.25
Godrej Housing Finance 9.75-14.50
ICICI Bank 9.75-10.90
Tata Capital 10.10 onwards
Bajaj Housing Finance 8.60-18.00
Axis Bank 9.90-10.35
Kotak Mahindra Bank 9.50-11.70

Note: The interest rates used for comparison are as of December 2022.

Union Bank of India Loan Against Property Customer Care Number

Union Bank of India LAP customer care can be reached at the following numbers.

All-India Toll-Free number- 1800 22 22 44 / 1800 22 22 43 / 1800 208 2244 / 1800 425 1515

Charged Numbers- 080-61817110

The dedicated number for NRIs is +918061817110

FAQs

From refinancing to reducing your interest, we have the answers right here.

What is the interest rate of loans against property in Union Bank of India?

The interest rate of loans against property in Union Bank of India ranges from 12.05% to 12.95%.

What are the benefits Union Bank of India Provides on loans against the property?

The major benefit of Union Bank of India LAP is that a borrower can borrow up to INR 10 crores against their property. Follow our guide to learn more about its benefits.

Does the Union Bank of India have a fixed interest rate on loans against the property?

No, the Union Bank of India does not have a fixed rate of interest on a loan against property.

How to check a loan against property Status in Union Bank of India?

Applicants can visit the bank or log in to their accounts to check the LAP status.

Does Union Bank of India check for CIBIL score for loans against the property?

Yes, Union Bank of India checks for CIBIL scores for loans against property.

What is the maximum and minimum loan against property amount I can get from Union Bank of India?

Loan up to INR 10 crores is offered by the bank on LAPs.

What KYC documents must I submit to apply for a loan against property from Union Bank of India?

Address proof, residence proof, photographs, and income source documents are a few KYC documents you must submit to apply for a Union Bank of India loan against property. Read the ‘Documents Required’ section to know more.

What is the processing fee on the Union Bank of India loan against property?

The processing fee charged to meet Union Bank of India loan against property requirements is 0.50%-1.00% of the loan amount, subject to a minimum of INR 10,000. Customers may contact the bank’s customer service or banking representative for more information.

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