Loan Against Agricultural Land

A loan against agriculture land is a mortgage loan variant offered against a piece of land owned by the borrower/farmer. You can avail of the maximum loan amount equivalent to the price of the mortgaged land. Loan against agricultural land loan can be used by the borrower for a variety of purposes like meeting production and consumption needs, crop cultivation expenses, equipment purchase, and managing personal needs (marriage, medical treatment, education, etc.).

Check Loan Against Property Interest Rate for lowest LAP Interest Rates.

• Mortgage loan against agricultural land is offered to farmers, planters, horticulturists, dairy owners, orchard owners and other such people who cultivate crops. 
• Funds can be used for agricultural purposes like buying agricultural equipment, food processing, setting up dairy units/ fisheries/ rice mills/ greenhouse/ cold storage/ horticulture centres, micro-irrigation, buying agriculture insurance to protect from crop losses, and so on.
• Usually, farmers are not required to submit income tax returns to apply for this loan.
• These loans require minimum documentation.
• The loan tenure can go up to 20 years.
• Mortgage loan against agricultural land interest rates are typically lower than personal loans.
• No hidden charges are involved for these loans.
• Considering the farmer’s situation, lenders usually come up with a flexible repayment plan.
• The turnaround time for loan against agri land is quick and the lenders are sensitive to the harvest season.
• The borrower can avail of tax benefits on the interest paid.

You can also Check Loan Against Property without Income Proof and ITR

Compare Banks to get lowest Mortgage Loan Interest Rate.

• Farmers, planters, horticulturists, dairy owners, orchard owners and other people who cultivate crops are eligible to apply for a loan against property agricultural land.
• For most lenders, the age criteria is 21 to 65 years of age. However, a few banks offer loans to applicants aged 18 years or above. 
• If the land to be pledged is owned by two people, having a co-applicant is a must.
• Under this loan, an agricultural land is pledged as a collateral. The mortgaged land must have clear titles to be eligible to apply for a loan against farm land.
• Most lenders prefer applicants to have residential stability of at least 2 years.
• Most lenders offer loans against farmland based on the size of the pledged land. 

You can also check Loan Against Property Eligibility SBI

The list of documents required to avail of a loan against agricultural land in most banks is given below:

• Duly filled and signed application form along with passport size photographs
• Valid identity proof such as Passport, PAN card, Aadhaar Card, etc. 
• Valid address proof such as Passport, Aadhaar Card, Utility Bills, etc.
• Land documents such as registration, taxes paid, utility bills, etc.
• Copy of the land sale agreement
• Bank statement of at least the last 6 months
• No Due Certificate from Co-operative Credit Society 

You can also Check the necessary Documents required for Loan Against Property

Some of the most common charges levied on loans against agricultural land are:

• Processing fee on the sanctioned loan amount
• Part prepayment and foreclosure charges
• Property insurance charges
• Late payment penalty
• Conversion fees
• Cheque dishonour charges
• Incidental charges
• Statutory & regulatory charges
• Stamp duty
• Legal fees
• Fee for valuation of the pledged property 
• Inspection charges

You can apply for an agriculture loan against property either online or offline. 

Steps for Online Process

• Choose the preferred lender and visit its official website.
• Choose the ‘Loan Against Agricultural Land’ option, which is often given under the ‘Loans’ tab.
• Mention the required details carefully and attach the supporting documents. 
• Submit the entered information and documents.
• Your request will be processed, and the lender will take further steps to complete the loan process.

Steps for Offline Process

To apply for a loan against an agricultural piece of land, you have to visit the nearest branch of the preferred lender and apply for the loan by submitting the filled-in and signed application form.