Lease Rental Discounting
This loan is sanctioned based upon the future monthly rental income over a period of time and market valuation the property offered as collateral.
What is Lease Rental Discounting Loan?
Lease rental discounting is a kind of loan against property provided by bank or NBFC against rental receipts of the borrower which is derived from lease rent contracts with corporate clients. The loan is provided by lender to the lessor on the discounted value of the lease rentals and market value of the property.
Benefits of Lease Rental Discounting Loan
- BUSINESS EXPANSION:You can utilized lease rental discounting (LRD) loan amount towards expansion of your business.
- PURCHASE OF NEW PROPERTY:You can utilized lease rental discounting ,LRD loan amount for purchasing and building new property.
- CONSOLIDATION OF OTHER LOANS:Lease rental discounting loan amount can be utilized to pay off other personal loan, gold loan, business loan or any other small loan which are on high rate of interest because rate of interest on LRD is cheaper than unsecured loans.
- PERSONAL EXPENSESLease rental discounting (LRD) loan amount can be utilized to fulfill personal needs like medical expenses, marriage, educations, foreign tour etc.
- WORKING CAPITAL REQUIREMENT Lease rental discount (LRD) loan amount can be utilized to fulfill working capital requirement of your own business.
Eligibility Criteria
All the bank or NBFC have their own loan eligibility criteria but there are some common loan eligibility criteria which borrower has to fulfill to avail loan from bank or NBFC.
Following are some key important factors which would be checked by bank or NBFC to accept or reject the lease rental discounting loan application:-
- Age:At the time of lease rental discounting loan (LRD Loan) application, applicant must be 21 years or above but not more than 60 years in case of salaried person and 65 years in case of self employed non professional because repayment of the loan has to be completed on or before 60 or 65 years of borrower age.
- Lease Agreement Period:Lease agreement period is very critical and important factor for taking lease rental discounting loan from Bank or NBFC. Bank will not provide loan if lease period is less than 5 years.
- Other Source of IncomeBank or NBFC checks other source of income of an individual who is applying for lease rental discounting (LRD) loan. A secondary source of income, ensure the lender regular repayment of their loan EMI if lessee vacate the property
- CIBIL SCORE:A lease rental discounting (LRD) loan borrower who is having good cibil score will get quick loan from the bank or NBFC. Cibil score is a decisioning factor for sanctioning or rejecting lease rental discounting (LRD) loan applications.
- VALID, CLEAR AND MARKETABLE TITLE DEEDS OF PROPERTY:A lease rental discounting (LRD) loan borrower must be having valid, clear and marketable title deeds of entire chain of the property along with approved sanction plan or map. The ownership and physical possession of the property lies with the borrower only.
Documents required
KYC DOCUMENTS
- Pan Card
- Aadhar Card
- Voter ID Card
- Passport
- Copy of Rent Agreement/ Registered Lease Deed
- Latest Month Electricity Bill
- Copy of VAT/ Sales Tax, GST, Import-Export or any other registration Certificate
- Latest Office Address proof i.e electricity bill, rent agreement etc.
- Company Profile on the Letterhead of the firm
INCOME DOCUMENTS
- Latest 3 year ITR with computation of Income including P & L a/c, balance sheet with their schedule and annexures duly certified by CA
- Form No. 3 CA & 3 CD in case of audited balance sheet
- Latest 2 years VAT/ Sales Tax/ GST return
- Latest 2 years form 26AS if applicable
BANK STATEMENTS
- One year up to date all the saving and current account statement