Loan Against Property for Commercial Real Estate Financing

Commercial real estate projects demand significant upfront capital, often straining business cash flows. Delays in funding can stall growth, disrupt timelines, and reduce overall returns.

With equity financing becoming costly and dilutive, businesses are turning to asset-backed solutions. The LAP market is projected to grow at a CAGR of 13.28% through 2030, reflecting its rising demand in commercial real estate financing.

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What is a Loan Against Property (LAP)?

Loan Against Property (LAP) is a secured way for businesses to raise capital by using owned property as collateral.

It offers lower interest rates than unsecured loans and avoids equity dilution, making it ideal for funding commercial real estate purchases without giving up control.

Also Read: Business Loan Collateral: Types, Eligibility Criteria, and Requirements

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How LAP Works for Real Estate Financing?

• Application: Submit property documents, financial statements, and business details to the lender.
• Valuation and Eligibility Check: The lender assesses the property's market value and the borrower’s repayment capacity.
• Loan Sanctioning: Based on eligibility, 50 to 70 percent of the property's value may be approved.
• Disbursement: Funds are released for purchasing or developing commercial real estate.
• Repayment: The loan is repaid in EMIs over a fixed tenure. Failure to repay may lead to loss of the property.

Also read: 10 Essentials for Business Loan Success

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Benefits of LAP for Commercial Real Estate

• Lower Cost of Capital: Interest rates are more competitive than unsecured loans, reducing financing costs.
• Flexible Usage: Funds can be used for purchase, renovation, or refinancing of commercial properties.
• Supports Expansion: Enables acquisition of office space, warehouses, or retail locations essential for scale.
• Long-Term Advantage: Suitable for businesses looking to invest in assets aligned with strategic goals.

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Eligibility & Documents

When checking eligibility for a loan against property for commercial real estate, lenders generally require:

• Minimum 1 year of business operations
• Stable cash reserves for at least 6 months
• Credit score of 685 or above
• Annual revenue of ₹40 crore 

Required Documents include:

• GST registration
• PAN and CIN
• Income proofs
• GST and tax filings
• Bank statements and audited financials

Pro tip: Ensure a strong credit profile and complete documentation to boost your chances of approval.

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How to Apply for a Loan Against Property for Business?

Recur Club simplifies access to capital through a fast, expert-led process:

• Step 1: Sign up and connect with a dedicated capital expert
• Step 2: Sync your financial tools to securely share data like GST returns, revenue, and compliance records
• Step 3: Review tailored offers, compare terms, and finalize the most suitable financing structure

Our process ensures faster decisions, minimal friction, and full guidance throughout.

Apply now 

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Conclusion

For businesses planning commercial real estate expansion, structured funding is essential. Loan against property offers a practical way to raise capital without giving up equity or control.

Recur Club enables fast, flexible financing with:

• 125+ lenders to match you with the best terms
• Ultra-fast capital with term sheets in just 48 hours
• Trusted capital advisory for expert guidance

Find the right structure, lender, and terms—all in one place. Get started with Recur Club.