Loan against Industrial Property

Manufacturing business is always in need for funds for various purposes. It can be either be for working capital loans to meet day to day operational expenses, upgradation of machines, to meet increased work load or to purchase new plant and machinery. This mortgage loan can be availed against various types of properties like Industrial Sheds, Plots, warehouse, Cold Storage etc, either owned by business or any of the promoters.

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What is Loan against Industrial Property?

If you are a businessman and running a manufacturing company in your owned industrial property, you may require funds for expansion of your company, want to infuse capital in your business, want to introduce new technology in your business, etc. To fulfill your requirements you can take loan against your pre-owned industrial property from bank or NBFC. This type of loan is called loan against industrial property or industrial property loan.

Benefits of loan against Industrial Property

  • INTRODUCING NEW TECHNOLOGY: Many times you required to introduce new technology in your business, which will reduce your operating expenses, increase production and thus increase profitability of the business. New technology requires a heavy investment. You can take loan against industrial property from bank or NBFC to fulfill your requirement.
  • EXPANSION OF BUSINESS: All the manufacturer wants to expand his business. Business expansion requires large amount of investment. You can borrow loan against industrial property from bank or NBFC and invest loan amount towards your business expansion.
  • CONSOLIDATION OF LOANS: Many times for your business or personal need, you may have borrowed machinery loan, personal loan, business loan, gold loan etc. from bank or NBFC. These loans were lent by bank or NBFC for shorter period, on high rate of interest resulting on heavy EMI. These heavy EMI suck your business liquidity also. Bank or NBFC offers loan against industrial property comparatively at lower rate of interest for longer period of time resulting in low EMI. You can take loan against industrial property and repay all these small loans and keep a single EMI.
  • TO MEET PERSONAL EXPENSES: Many times you have to make certain expenditure for which you have not made any planning, expenses such as medical emergency, child higher education, daughter marriage, etc. required a lot of money. Either you have to sell your property or borrow loan against industrial property from bank or NBFC to meet these personal expenses

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 against industrial property from bank or NBFC.

Following are some key important factors which would be checked by bank or NBFC to accept or reject the loan against industrial property application:-

  • Age:At the time of loan against industrial property application, applicant must be 21 years or above but not more than 65 years because repayment of the loan has to be completed on or before 65 years of borrower age.
  • Business Continuity:Bank or NBFC checks business continuity of an individual or company who is applying for loan against industrial property. An individual or company should be in the business for at least 3 years. A regular source of income, ensure the lender regular repayment of their loan EMI.
  • Cibil Score:A loan against industrial property 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 loan against industrial property applications.
  • VALID, CLEAR AND MARKETABLE TITLE DEEDS OF PROPERTY: A loan against industrial property 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