Funding Your Wedding with a Loan Against Property – Yay or Nay

Weddings in India are expensive affairs. It involves making a lot of preparations including fixing up the venue, purchasing of wedding dresses, jewelry, inviting guests, decorations, catering, and so on. The list is an endless one. It can exhaust all your savings. You might require more funds if your savings are not enough. You can opt to borrow from friends or family. People do that, but there is a better option. You can take Personal Loans from banks and other financial institutions.

Let us see the benefits and drawbacks of taking a Personal Loan to fund your wedding.


  • Personal Loans are readily
  • You need not disclose the purpose of the loan to your lenders.
  • There is no need to provide collateral.
  • These loans have the quickest turnaround time.


  • The Personal Loans carry high-interest
  • The loan tenure is not more than 60 months thereby resulting in high EMI (Equated Monthly Instalment) in case of significant
  • It is difficult to get large loans because of the stricter eligibility norms

Is there an alternative to Personal Loans? Yes, there is one in the form of ‘Loan Against Property.’

Advantages of Loan Against Property:

  • You can apply for a higher amount as compared to Personal Loans. Banks usually provide loans against the property to the extent of 90% of the value of the property.
  • The rate of interest on Loan Against Property is much lower than that of a Personal Loan.
  • In case you have a Home Loan against the same property, you can Apply for a Loan Against Property from the same bank. Banks approve such facilities depending on your eligibility and availability of margin. You can get top up on your Home Loan as a Loan Against Property at low interest.
  • Banks accept a lower credit score in the range of 650 because of the presence of collateral.

Disadvantages of Loan Against Property

  • It increases your loan liability. In case you have a Home Loan as well, the additional EMI can be a burden.
  • Loans Against Property has a more extended turnaround time. The eligibility criteria are also quite strict. In case you have a Home Loan against the same property, it can become difficult to satisfy this criterion unless there is a drastic increase in the value of the property.
  • Applying for a Loan Against Property will incur additional expenses like processing fees (0.5% to 1%), legal scrutiny charges (in case of new property), valuation charges, stamp duty and registration charges on the creation of an equitable mortgage, and so on.

Looking at the differences mentioned above, it can be said that if you are planning a grand wedding, Loan Against Property can be the better and cost-effective choice than a Personal Loan.

Eligibility Factors for Loan Against Property:

  • You should provide your income details to the bank/lender.
  • The banks have specific eligibility criteria. In case you have other loans like Home Loans and Credit Cards, it can become difficult to satisfy the eligibility criteria.
  • The maximum eligibility amount is 90% of the value of the property.

The procedure to apply for a Loan Against Property

  • Do your research well. Search for the right lender. Usually, people go to the same lender in case they have Home Loans.
  • If you do not have a Home Loan, you can take the help of online loan service providers like You get access to many lenders on a single platform. Choosing the right one to suit your needs becomes easy.
  • Submit your KYC and income proof documents. These documents include your PAN card, Aadhar Card, Ration card, IT returns, and proof of employment/business. Banks look for stability and continuity in the income. Submitting bank account statements can help them in this regard.
  • You need to submit the photocopies of the title deeds and other documents relating to your property.
  • The lender conducts a search of the property with the Sub-Registrar’s office to check for any encumbrances and genuineness of title.
  • The valuation of the property is essential. Banks have their panel evaluators who inspect the property and provide the appropriate market value. Your loan amount depends on this value.
  • The procedure of the Loan Against Property is similar to that of a home loan in many respects. The only difference is in the eligibility criteria.
  • On approval of the loan, you execute the documents and create the equitable mortgage of the property in the lender’s favor.
  • The disbursal process is simple. The lenders credit the amount to your bank account.

It brings us back to the question, “Is a Loan Against Property the best option for funding a wedding?” The answer is “Yes, it is.” You do not have to depend on anyone else for a loan. You have your asset to help you out.

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