Loan Against His Father Property
You’re probably reading this because you need funds urgently. Maybe your business needs capital. Or there’s a medical emergency. Perhaps you want to consolidate multiple loans into one manageable payment.
The property is there—your father’s house or commercial building. It’s been in the family for years. And now you’re wondering: can I actually get a loan against property using my dad’s asset?
The straightforward answer is yes. But there’s a process to follow, paperwork to complete, and some conditions to meet. Let me walk you through everything you need to know.
The Reality About Taking Loans on Your Father’s Property
Here’s something most people don’t realize right away. You cannot walk into a bank, show them your father’s property papers, and get a loan sanctioned in your name alone. That’s not how it works.
The property owner has to be involved. Always. Your father needs to either apply as the main borrower or join you as a co-applicant. Both of you will share the responsibility for repaying the loan.
Think of it like this—would you give someone money against an asset they don’t legally own? Banks think the same way. They need the property owner’s consent, signature, and participation in the loan process.
Now, I know what you’re thinking. My father is 68 years old. Will that create problems?
Let me address that concern head-on.
Does Your Father’s Age Matter for the Loan?
Yes and no. Let me explain both sides.
Most banks have age limits. They typically want the borrower to be under 70 or 75 years at the time the loan ends—not when it starts. So if your father is 68 now and the bank’s limit is 75, you’re looking at roughly a 7-year maximum loan tenure.
That’s the technical part. Here’s the practical reality: banks are more flexible when there’s a younger co-applicant with solid income. If you’re 35 or 40 years old with a stable job or business, your age becomes the deciding factor for tenure.
I’ve seen cases where fathers in their late 60s successfully got loan against property approvals because their sons were the primary earners. The bank’s main concern is repayment capacity—not just age.
According to CIBIL data, co-applicant arrangements actually improve approval rates. You bring youth and income stability. Your father brings the property. Together, you create a strong application.
But let’s get into the specifics of how this actually works.
Two Ways to Structure This Loan Application
There are two common scenarios when a son wants to take loan on father property.
Your Father Applies, You Support
This is the most common approach. Your father becomes the primary applicant because he owns the property. You join as a co-applicant who will help repay the loan.
The bank checks both of your income sources. Your salary slips or business income. Your father’s pension or any other regular income he receives. They add these together to calculate how much loan you can handle.
This setup works perfectly when you need funds for business expansion or starting an MSME unit. Your father provides the security. You provide the repayment strength.
Both of You Own the Property
Some families transfer property ownership to include the son while the father is still alive. If your name is already on the property documents along with your father’s, the loan process becomes simpler.
You both apply together as co-owners and co-applicants. No one is “primary” or “secondary” here. The bank sees joint ownership and joint responsibility.
Want to understand more about how co-applicants affect loan approval? Read this detailed guide on role of co-applicant in loan approval.
What Banks Look for When You Apply
Let me be brutally honest about eligibility. Banks don’t hand out money easily, especially large amounts. And loan against property can go into crores depending on the property value.
They check three main things—the property, the applicants, and the ability to repay.
Checking the Property
Your father’s property needs to tick several boxes:
The title should be absolutely clear. No legal disputes. No court cases. No confusion about ownership. Banks conduct thorough legal checks going back 10 to 15 years.
The property must be in decent condition. They won’t accept structures that look ready to collapse. For older properties, they might ask for an engineer’s certificate confirming structural stability.
Location matters more than you’d think. A property in Mumbai suburbs will get you a better loan deal than the same value property in a remote village. This isn’t discrimination—it’s about how easily the bank can sell the property if things go wrong.
Property types that work: residential houses, flats in approved societies, commercial shops, office spaces, industrial units. What doesn’t work: agricultural land in most cases, unauthorized constructions, properties in disputed zones.
Check out this complete list of property types for loan against property to see where your father’s asset fits.
Checking Your Father’s Profile
Age I’ve already covered. At 68, your father is well within acceptable limits for most lenders.
Credit history matters, but not as much as you’d expect if you’re the primary income source. Banks prefer a CIBIL score above 650 for older applicants. If your father has never taken loans, that’s fine too. No history is better than bad history.
If he’s receiving a pension, banks view that positively. It shows a regular, stable income source even after retirement.
Checking Your Profile
This is where the heavy lifting happens. Banks scrutinize you carefully because you’re likely going to be making the EMI payments.
Age: Usually between 21 and 60 years at the time the loan ends. You’re probably well within this range.
Income: Here’s where it gets real. Salaried people typically need to show at least Rs. 25,000 to Rs. 30,000 monthly income. Self-employed individuals should demonstrate annual business income of Rs. 3 lakhs or more. But these are minimums. The actual amount depends on the loan you’re seeking.
Employment stability: For salaried folks, banks prefer at least 2 years in your current job and 3-5 years total work experience. Self-employed? Your business should be running for at least 3 years with consistent profits.
Your credit score carries serious weight. A score above 700 opens doors. Above 750, and you can negotiate better interest rates. Below 650, you’ll face tough questions or possible rejection. Want to improve your score quickly? Follow this 90-day CIBIL improvement guide.
Existing debts: Banks calculate your debt-to-income ratio. If your current EMIs and credit card payments already consume 50-60% of your income, they’ll be cautious about adding more debt. You might need to close some existing loans first.
Read more about complete eligibility for loan against property to assess where you stand.
Assessing Repayment Capacity
Banks use a simple formula: they want to see that your combined monthly income can comfortably cover the EMI with room to spare for living expenses.
If you and your father together make Rs. 80,000 per month, and the proposed EMI is Rs. 35,000, that’s acceptable. If the EMI would be Rs. 55,000, that’s risky territory.
Use an EMI calculator before applying. Know what your monthly commitment will be. This prevents surprises later.
Papers You’ll Need to Arrange
Documentation can feel overwhelming. I’m going to break this down into exactly what each person needs to submit.
Your Father’s Documents
For identity and address, he needs:
- Aadhaar card (mandatory for most banks now)
- PAN card
- Passport or voter ID as additional proof
For income verification:
- Last 6 months of pension slips
- Bank statements showing pension credits
- If he has any other income source, ITR documents
The property papers are crucial. Missing even one can delay approval by weeks:
- Original title deed proving ownership
- Previous sale deed or purchase agreement
- Property tax receipts for the last 3 years
- Sanctioned building plan from the municipal corporation
- Occupancy certificate or completion certificate
- Encumbrance certificate showing no loans or disputes for 10-15 years
- If it’s a flat, NOC from the housing society
- Latest property tax paid receipt
One often-missed document: property insurance papers if the property is insured.
Your Documents
Identity proof—Aadhaar and PAN are non-negotiable.
For salaried applicants:
- Last 6 months salary slips
- Last 12 months bank statements showing salary credits
- Employment certificate on company letterhead
- Form 16 for the last 2 years
- ITR acknowledgments for 2-3 years
For self-employed or business owners:
- Business registration certificate
- GST registration documents
- ITR with computation sheets for 3 years
- Audited balance sheet and profit-loss statements
- Business bank statements for 12 months
- Proof of business address and vintage
Credit-related documents:
- Your CIBIL report (most banks pull this themselves, but having a copy helps)
- Details of all existing loans—sanction letters, statements
- Credit card statements if you have high utilization
One document many people forget: proof of relationship between father and son. A birth certificate works. School leaving certificates where parents’ names appear also work. Some banks accept a simple affidavit.
If property ownership is unclear or involves multiple people, NOCs from all other legal heirs might be needed. This is common with ancestral properties.
Get everything photocopied. Self-attest every copy. Keep originals ready for verification.
For the complete checklist, refer to documents for loan against property.
The Step-by-Step Journey from Application to Money in Bank
Let me walk you through what actually happens after you decide to apply.
Before You Approach Any Bank
Do your homework first. Know roughly how much your father’s property is worth. You can check similar properties in the area or use online property valuation tools.
Decide how much loan you need. Don’t just go for the maximum available. Borrow what you actually require. More debt means more interest paid over time.
Check both credit scores—yours and your father’s. You can check credit score free on several websites. If scores are low, consider waiting and improving them first. A few months of building credit can save you lakhs in interest.
Verify that all property documents are in order. Missing or unclear papers will cause rejection. Get an encumbrance certificate from the sub-registrar’s office—it costs a few hundred rupees and proves no existing loans on the property.
Calculate EMI affordability. Be realistic. Can you comfortably pay this amount every month for the next 10-15 years? Life has unexpected expenses. Leave a safety margin.
Choosing Where to Apply
Not all banks and NBFCs offer the same deal. Interest rates vary. Processing fees differ. Some are faster, others more bureaucratic.
Public sector banks like SBI, Bank of Baroda, and PNB typically offer lower interest rates. They’re also more strict about documentation and approval criteria.
Private banks like HDFC, ICICI, and Axis Bank process applications faster. Their interest rates might be slightly higher, but customer service is usually better.
NBFCs like Tata Capital, LIC Housing Finance, and L&T Finance are more flexible with age limits and credit scores. They’re good options if traditional banks reject you.
If you’re in West Bengal, local expertise matters. Check options for loan against property in Kolkata or your specific city.
Compare at least 3-4 lenders. Look at loan against property interest rates, processing fees, prepayment charges, and hidden costs.
Filing the Application
Once you pick a lender, fill out their application form. This can be done online or at a branch. I’d suggest going to the branch for this type of loan—face-to-face interaction helps clarify the co-applicant situation.
Submit all documents from both you and your father. Make sure nothing is missing.
Pay the processing fee. This typically ranges from 0.5% to 2% of the loan amount. On a Rs. 30 lakh loan, expect to pay Rs. 15,000 to Rs. 60,000 just for processing. Some lenders waive this during promotional periods.
Be clear about why you need the loan. Business expansion? Debt consolidation? Medical emergency? Education? Being specific helps, though loan against property doesn’t have strict end-use restrictions like home loans do.
Property Inspection and Valuation
Within a few days, the bank will send someone to physically inspect the property. They’re checking:
- Does it actually exist at the address mentioned?
- What’s the condition—new, old, well-maintained, dilapidated?
- What’s the neighborhood like? Are similar properties selling well?
- Any construction violations or unauthorized additions?
A certified valuer will assess market value. They compare your property with recent sales in the area. They consider size, age, location, amenities, and accessibility.
This valuation determines your loan amount. Banks typically offer 50% to 75% of the property’s market value as loan—this is called the Loan-to-Value ratio.
So if your father’s house is valued at Rs. 60 lakhs, expect loan offers between Rs. 30 lakhs to Rs. 45 lakhs. Learn more about LTV in loan against property.
Simultaneously, the legal team verifies all property documents. They’re looking for:
- Clear title in your father’s name
- No pending court cases
- No existing mortgages
- Proper approvals from local authorities
- Clean encumbrance certificate
This investigation protects the bank. If they lend money against disputed property, they might never recover it if things go wrong.
According to Reserve Bank of India regulations, this verification process is mandatory for all secured loans. It can take 7 to 15 days depending on how complex your property’s history is.
Credit Assessment
While property checks happen, the credit department examines you financially.
They’re pulling credit reports for both applicants. They’re analyzing your CIBIL score factors to understand borrowing behavior.
They calculate your debt-to-income ratio precisely. How much do you already owe? How much can you realistically afford to add?
They verify your income claims. For salaried folks, they might call your HR department. For self-employed, they scrutinize business financials carefully. Chartered accountant certification helps here.
They look at banking behavior. Regular salary credits, healthy balances, and disciplined spending patterns work in your favor. Frequent overdrafts, bounced cheques, or suspicious transactions raise red flags.
During this stage, they might ask for additional documents or clarifications. Respond quickly. Delays at this stage mean delays in getting your money.
Loan Approval and Sanction
If everything checks out, you get the golden email or call—your loan is sanctioned.
The bank sends a formal sanction letter detailing:
- Approved loan amount
- Interest rate (fixed or floating)
- Loan tenure
- Monthly EMI
- Processing fees and other charges
- Terms and conditions
Read this letter very carefully. Pay attention to:
- Prepayment charges: Some banks charge 2-4% of outstanding amount if you want to close the loan early. Learn about how to foreclose LAP.
- Late payment penalties
- Insurance requirements
- Property insurance clauses
You typically have 30 to 90 days to accept the sanction letter. If you don’t accept within this period, you’ll need to reapply.
Legal Formalities and Disbursement
Once you accept, the documentation marathon begins.
You’ll visit the bank multiple times to sign various papers:
- Loan agreement
- Mortgage deed
- Post-dated cheques for EMI
- Standing instruction for auto-debit
- Declaration letters
- Indemnity bonds
The mortgage deed needs to be registered at the sub-registrar’s office. This makes the property mortgage official and legally binding. You’ll pay:
- Stamp duty (varies by state, usually 0.1% to 0.5% of loan amount)
- Registration charges
- Legal fees
In some states, this can add Rs. 10,000 to Rs. 50,000 to your costs depending on loan size.
After registration, the bank receives the original property documents. They keep these as security until you fully repay the loan.
Finally—disbursement. The loan amount gets credited to your bank account. This usually happens within 3 to 7 days after completing all documentation.
Total time from application to money in hand: typically 3 to 6 weeks for straightforward cases. Complex properties or unclear documentation can stretch this to 2-3 months.
Want a detailed walkthrough? Read how to apply for a loan against property.
The Real Advantages You Get
Why would someone go through this elaborate process when unsecured personal loans are available with less paperwork?
Because loan against property offers benefits that no unsecured loan can match.
Interest rates are significantly lower. While personal loans charge 11% to 18%, LAP typically ranges from 8.5% to 12%. On a Rs. 30 lakh loan over 10 years, this difference saves you several lakhs in interest.
You can borrow much larger amounts. Personal loans max out at Rs. 25-30 lakhs for most people. LAP can give you Rs. 50 lakhs to Rs. 5 crores depending on property value. This makes it perfect for business expansion or major financial needs.
Longer repayment tenure means smaller EMIs. You can stretch repayment up to 15-20 years. This gives breathing space to your monthly budget. The loan against property tenure flexibility is a major advantage.
End-use flexibility is massive. Unlike home loans that must be used for buying property, LAP money can be used for anything—business working capital, education abroad, medical treatment, debt consolidation, buying machinery, funding a startup, or personal needs.
Tax benefits exist if used for business. Interest paid on LAP used for business purposes is tax-deductible. Check detailed loan against property tax benefits.
Credit score improves with timely payments. Every EMI you pay on time boosts your and your father’s credit scores. This helps in future borrowing. Learn how to improve CIBIL score through disciplined loan repayment.
You keep the property. You’re not selling the family asset. After loan repayment, the property is released from mortgage. Your father retains ownership throughout.
Explore more benefits of loan against property to understand the full picture.
The Risks You Must Understand
I’d be irresponsible if I only told you the good parts. LAP comes with serious risks that you must understand before signing anything.
The family property is on the line. If you fail to pay EMIs for an extended period, the bank can legally take possession and sell the property to recover their money. This isn’t a theoretical risk—it happens. Read about what happens if you default on LAP.
Processing takes longer. Unlike personal loans that can be disbursed in days, LAP requires weeks due to property valuation and legal checks. If you need money urgently, this might not work.
Upfront costs add up. Processing fees, valuation charges, legal fees, stamp duty—these can total 1-3% of your loan amount. On a Rs. 40 lakh loan, you might spend Rs. 40,000 to Rs. 1.2 lakhs before getting any money.
Your father’s age limits tenure options. At 68, maximum tenure might be restricted even with you as co-applicant. Shorter tenure means higher EMIs, which might strain your budget.
Long-term commitment means decades of payments. A 15-year loan means 180 monthly payments. Life circumstances change. Jobs change. Businesses face ups and downs. Can you commit to this for such a long period?
Property remains encumbered. During the loan period, you cannot sell or further mortgage the property without bank permission. This reduces financial flexibility.
Prepayment isn’t always free. Many lenders charge penalties if you want to close the loan early, typically 2-4% of the outstanding amount. These charges can negate the benefit of early closure.
Learn about common pitfalls when applying for LAP to avoid expensive mistakes.
What If Direct LAP Doesn’t Work?
Sometimes, despite best efforts, the loan against father property approach hits roadblocks. Maybe the property title has issues. Perhaps income doesn’t meet requirements. Or age calculations make tenure unworkable.
You have alternatives worth considering.
Property Transfer: Your father can legally transfer property ownership to you through a gift deed or sale. Once transfer completes, you apply independently. Downsides: stamp duty costs 5-7% of property value, the process takes 1-2 months, and family dynamics might complicate matters. Consult legal experts before attempting this.
Reverse Mortgage: If your father needs funds rather than you, reverse mortgage allows seniors to receive periodic payments against property value while living in it. No repayment during their lifetime. Different use case, but worth knowing.
Business Loans with Collateral: If loan purpose is business-related, explore business loans in Kolkata or your region that accept property as security but have different structuring.
Unsecured Business Loans: For smaller amounts under Rs. 25 lakhs, unsecured business loans work if your credit score is strong. Interest rates are higher, but there’s no property risk.
MSME-Specific Schemes: If you run a registered small business, explore MSME loan types and government loan schemes that offer better terms.
Gold Loans or Securities: For immediate smaller needs, gold loans or loans against bonds process faster with less documentation.
Practical Tips for Getting Approved
Let me share some real-world advice that improves approval chances.
Fix credit issues first. Three months spent improving credit scores can save you years of higher EMI payments. Pay off credit card debt. Clear small loans. Avoid applying for multiple loans simultaneously. Follow our CIBIL improvement guide religiously.
Clean up bank statements. Banks scrutinize 6-12 months of statements. Maintain healthy balances. Avoid overdrafts and bounced cheques. Show consistent income deposits. Minimize cash transactions—use digital payments wherever possible.
Reduce existing debt before applying. Pre-close smaller loans if possible. This improves your debt-to-income ratio. If you have expensive personal loans, consider using LAP itself for debt consolidation.
Get property documents in perfect order. Don’t wait for the bank to identify issues. Get encumbrance certificate, pay pending property taxes, and ensure building plans match actual construction. Missing documents cause rejections.
Borrow realistically. Don’t maximize loan just because you can. Keep EMI under 40% of combined income. This leaves buffer for emergencies and increases approval probability.
Consider using a professional. Loan consultants or DSA partners understand which lenders suit your profile. They can speed up approvals, help with documentation, and sometimes negotiate better rates through existing relationships.
Apply to the right lender. A rejected application hurts your credit score. If your credit isn’t perfect, NBFCs might be more lenient than traditional banks. If you have excellent credit, chase the lowest rate from public sector banks.
Prepare explanation letters. If credit report shows any irregularities—a late payment, a settled loan, high credit utilization—prepare explanation letters proactively. Banks appreciate transparency.
Understanding Costs Beyond Interest
People often focus only on interest rates while ignoring other costs that can add tens of thousands to the final bill.
Processing fees: 0.5% to 2% of loan amount, typically non-refundable even if loan gets rejected.
Valuation charges: Rs. 2,000 to Rs. 10,000 depending on property type and location.
Legal fees: Banks charge for legal verification, usually Rs. 5,000 to Rs. 15,000.
Stamp duty and registration: Varies by state but adds 0.1% to 0.5% of loan amount.
Property insurance: Some banks mandate fire and earthquake insurance, costing Rs. 3,000 to Rs. 10,000 annually.
Late payment charges: 2% per month on overdue amount. Three late payments can add Rs. 10,000+ in penalties.
Prepayment charges: 2-4% of outstanding principal if you close early. On a Rs. 30 lakh outstanding balance, that’s Rs. 60,000 to Rs. 1.2 lakhs.
Bounce charges: Rs. 500 to Rs. 1,000 per bounced EMI cheque or failed auto-debit.
Calculate total cost of borrowing, not just EMI. Use our loan against property EMI calculator to see the complete picture.
Making the Final Decision
Taking a loan against property on father’s property when he’s 68 isn’t just a financial decision. It’s a family decision with emotional dimensions.
Sit down with your father and have an honest conversation. Does he fully understand what mortgaging the property means? Is he comfortable with this risk? How will other family members react?
Consider worst-case scenarios. What happens if your business fails? If you lose your job? If there’s prolonged illness? Can you manage EMIs through tough times? Do you have backup plans?
Assess alternatives one final time. Is LAP really the best option? Could you arrange funds through other means with less risk?
If you’re confident about repayment capacity, have stable income sources, and need substantial funds at reasonable rates, LAP makes perfect sense. The loan against property vs business loan comparison often shows LAP as the winner for larger amounts.
But if there’s any doubt about your ability to sustain 15 years of EMI payments, reconsider. No business opportunity or financial need is worth losing the family home.
Frequently Asked Questions
Can I get a loan on my father’s property without his knowledge?
Absolutely not. This would be illegal and constitute fraud. Property owners must be informed, involved, and consent to mortgaging their assets. Banks require property owners to be applicants or co-applicants with signed documentation. Attempting to secure loans on someone else’s property without consent can lead to criminal charges.
How much loan can I get on a property worth Rs. 50 lakhs?
Banks typically offer 50% to 75% of property value as loan. On a Rs. 50 lakh property, expect Rs. 25-37.5 lakhs. The exact amount depends on your repayment capacity, credit score, property location, and lender policies. Higher LTV ratios go to applicants with excellent credit and strong income. Check maximum loan amount for LAP for detailed calculations.
Will this loan affect my father’s pension or retirement benefits?
No. Taking a loan against property has zero impact on pension, provident fund, gratuity, or any retirement benefits. However, as co-applicant, your father shares legal responsibility for repayment. If EMIs aren’t paid, both credit scores suffer and the property faces foreclosure risk—but pension entitlements remain untouched.
What happens to the loan if my father passes away during the loan period?
The loan responsibility transfers to the co-applicant (you). As long as you continue paying EMIs, nothing changes. If you stop payments, the bank can proceed with foreclosure. Many banks offer loan insurance that clears outstanding amount in case of borrower death—consider this option for peace of mind.
Can agricultural land be used for loan against property?
Generally no. Most banks and NBFCs don’t accept agricultural land due to legal restrictions under land revenue laws. However, if agricultural land is converted to non-agricultural use with proper documentation, some lenders might consider it. Residential and commercial properties are far easier to mortgage.
Is fixed or floating interest better for LAP?
It depends on rate expectations. Fixed rates give certainty—your EMI never changes. Floating rates fluctuate with market conditions but typically start 0.5-1% lower. Given current RBI policy trends, many experts suggest floating rates for long-tenure loans. Compare fixed vs floating rates for LAP before deciding.
Ready to Move Forward?
You now have a complete understanding of how a son can take loan against father property even when the father is 68 years old.
The process is absolutely doable with proper planning, documentation, and realistic assessment of repayment capacity. Thousands of Indian families successfully navigate this every year for business growth, education, medical needs, and financial consolidation.
The key is approaching it methodically. Check eligibility first. Get property documents in order. Improve credit scores if needed. Compare lenders thoroughly. Calculate EMI affordability honestly. And most importantly, ensure everyone in the family understands and agrees with the decision.
Need Expert Guidance?
Don’t navigate this complex process alone. One wrong step, one missing document, one unsuitable lender choice can mean rejection or unfavorable terms.
Contact CreditCares today for personalized assistance
