Yes, but it depends on the bank, the property’s legal status, value, and documentation. In India, lenders can offer a loan against property (LAP) if you own the property outright, have a clear title, and its market value meets the lender’s criteria.
Do We Get a Home Loan on a Chawl Room?
LAP is a secured loan where your residential or commercial property is mortgaged as collateral in exchange for funds.
However, chawl rooms (especially in old tenements/slums) are evaluated more strictly because banks view them as higher-risk collateral. Some lenders may not accept such properties if they lack proper approvals, occupancy certificates (OC), or clear legal titles.
The property must be clearly owned by you or co-owned with family, and all papers (title deed, registered sale deed) must be valid and free from disputes. Lenders won’t accept disputed or unregistered chawl rooms.
Banks usually require that the property be in a recognised municipal limit and properly approved meaning it isn’t an unauthorised slum structure. If a chawl room has proper registration and municipal approvals, lenders may consider it.
Even if accepted, lenders typically offer only a percentage of the property’s market value, often around 60% to 70% as a loan amount. A low valuation for a small chawl room means lower loan amounts.
Like all LAP loans, banks will check your income, credit score, age, and repayment capacity before sanctioning any loan. A strong profile increases chances of approval even for non-standard properties.
Banks (SBI, HDFC, ICICI) and NBFCs accept residential or commercial properties as collateral. If the chawl room doesn’t meet standard criteria, some NBFCs or smaller finance companies can be more flexible than big banks. You may get approval if the paperwork is clean and the property is marketable.
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Hey,
According to my research there are several financial institutions that provide loans against a chawl property. However, you need to make sure the chawl is an approved property by a regulatory body.
Check out NoBroker Home Loan services to get a loan against your dream house
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Can I get loan against chawl room
Vipul Chawda
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3 Year
2022-10-12T14:46:48+00:00 2022-10-14T11:00:07+00:00Comment
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