Just like a home loan, you can also take a loan to buy land. A land purchase loan allows you to buy land easily by paying in installments. However, similar to other loans, you also need to pay interest on this loan.

What is a Land Purchase Loan?

In today’s economy, loans are commonly used to buy goods and property. While we often hear about home loans, personal loans, and education loans, a land purchase loan is specifically designed to help you buy land. This loan works similarly to other loans, allowing you to pay for the land in installments. However, it typically carries a higher interest rate compared to a home loan.

How Much Interest Will You Have to Pay?

Taking a land purchase loan is generally more expensive than a home loan. The interest rates for a land purchase loan range between 8.6% to 17% annually, depending on the bank or institution. Additionally, the tenure for a land purchase loan is shorter than a home loan, ranging from 5 to 20 years.

Eligibility Criteria for a Land Purchase Loan

The eligibility for a land purchase loan is similar to that of a home loan. Here are the key requirements:

Age Criteria:

Minimum age: 21 years

Maximum age: 65 years

Income Criteria:

If salaried: The Minimum monthly income should be ₹10,000.

If self-employed: Annual income should be at least ₹2,00,000.

Credit Score:

A good credit score is essential to qualify for the loan.

Documents Required for a Land Purchase Loan

To apply for a land purchase loan, you will need the following documents:

Identity Proof:

Aadhaar card, PAN card, or any valid identity card.

Address Proof:

Ration card, electricity or water bill, or lease agreement.

Income Proof:

For salaried applicants: Bank statements for the last 6 months.

For self-employed: Latest income tax assessment.

Property Documents:

Title deed, land tax receipt, and any other documents requested by the bank.

Key Features of a Land Purchase Loan

  • A land purchase loan helps you buy land without paying the full amount upfront.
  • You can repay the loan in installments, but the interest rate is higher than a home loan.
  • The loan tenure ranges between 5 to 20 years, depending on the bank’s terms.
  • By meeting the eligibility criteria and submitting the required documents, you can easily apply for a land purchase loan and fulfill your dream of owning land.