® 
In a loan against property, the minimum interest rate can begin at about 8.50% and will increase based on various factors such as value of the property, employment and assessment of your ability to repay the loan without defaulting on payments.
Let us take a look at the factors that can affect the interest rate of your loan:
1 Loan amount – The higher the loan amount, the lesser the interest rate. So, if you are getting a larger loan amount by pledging a larger property, the interest rates will be lower compared to when you pledge a small property for a small loan amount.
2 Value of property – The higher the value of the property, the lower the interest rate on the loan. Also, in some cases, the rate of interest charged on a residential property is different from the rate charged on a commercial property.
3 Tenure – The longer the tenure to repay the loan, the more interest you will be paying on the loan. If you choose a shorter tenure, the out flow of money towards the interest will be comparatively lower.
4 Income – The higher your income, the lower the interest rate. This is because the lender considers you reliable and can judge that you can repay the loan without any monetary problems. Also, if you provide proof of regular income, your interest rate will be lower.
5 Employment with reputed companies – If you are employed by a reputed company that is listed with the bank you are borrowing from, the interest rates will be lower than if you are employed by an unlisted company.
6 Credit score and history – The higher your credit score, the lower the interest rates. Credit score shows the customer’s creditworthiness to the lender. So, if you have a high credit score, the lender considers you as a low risk factor and thus reduces the interest rate. A good credit score also allows you to negotiate the terms of interest. The longer your credit history, the lower the interest rate. If you have a good and long credit history, the lender will have more reason to trust you and will lower the interest rates.
7 Relationship with the lender – Long standing relationships with the lender can give you the power to help lower the interest rates on the loan. If you have been a faithful customer, the lender will offer the best terms on your loan against property.