Finding a loan to buy a residential property is quite easy. But finding a loan to buy commercial property is a bit tricky. The loan to purchase a commercial property comes under the umbrella of business loan. The funds from a business loan can be used in various need of a business, including buying a commercial property. The business loans to buy a real estate property are called commercial property loans and these types of loans allow the business to access capital specifically for the purchasing property, renovating a property, or doing both.

Commercial Property Loans in India

In India, the commercial property loan can be taken for mainly two kinds of properties, a) office space & b) Retail outlet. Generally, business loan lenders run a lot of verification before sanctioning a business loan. But when it comes to granting commercial property loan, the lenders become more sceptical as the risk increases in this type of business loan. Though getting business loans for buying commercial property is not very easy but it is never impossible. Here we have sorted a few lenders from whom you can easily avail a commercial property loan.

Best Lenders to Avail Commercial Property Loans

HDFC Non-Residential Property Loan

HDFC provides loans to buy commercial property which comes with a lot of benefits. The loan can be taken for purchasing or expanding the office space. The loan comes with a hassle free documentation. Along with the loan, the bank offers legal advice to the borrower. The repayment of the loan has to be done in instalments. The processing fee is up to 1.50% of the loan amount or Rs. 4,500 whichever is higher with applicable taxes. The interest rate starts at 9.90%.  The document required for a commercial property loan from HDFC are-

  1. Proof of identity and residence
  2. Proof of income
  3. Property related documents
  4. Business Profile
  5. Latest Form 26 AS
  6. List of Directors and Shareholders with their individual shareholding certified by a CA / CS in case of the business entity is a company
  7. Memorandum and Articles of Association of the Company

DHFL Commercial Property Purchase Loan

DHFL gives business loans to purchase commercial property loan to establish offices, shops, doctor’s clinic etc. The loan tenure of a commercial property loan can be as long as 15 years. The loan can be taken by salaried individuals, Self Employed Individuals, Proprietorships, Partnerships, Limited Liability Partnerships, Private Limited Companies and Limited Companies. This loan is a secured loan which requires collateral. The collateral has to be immovable property. The documents required for a DHFL construction loan varies from category to category. If you are a salaried employee and want to avail a commercial property loan, you will have to furnish the following documents-

  1. KYC Documents of applicant and co-applicants
  2. Salary slip for the last 3 months / Salary Certificate (If variable components like Over Time and Incentives are reflected then salary slips for the past 6 months are required)
  3. Latest Form – 16 if salary above Rs. 20000/- per month
  4. PAN Card
  5. Copy of all bank pass books/bank statements for the past 3 months including the front page
  6. Existing facility sanction letter/ Repayment Track Record (RTR) of the existing loan(s), if any
  7. Property Documents
  8. Company profile if it is a lesser known organization
commercial property business loan

ICICI Office Premises Loan

ICICI provides business loan for purchasing commercial property which is known as ‘ICICI Office Premises Loan’. This loan can be availed by both salaried and self-employed applicants. The interest rate of ICICI office premises loan starts at 9.65% and the processing fee is 0.5% – 1% of the loan amount or Rs. 2000/- whichever is higher with applicable Service Tax. To apply for this loan, the age of the applicant must be a minimum of 24 years. Self-employed professionals like doctors, architects, etc and self-employed non-professionals like businessmen, traders, etc can avail this kind of business loan from ICICI.

  1. Proof of identity and residence
  2. Proof of income
  3. Property related documents
  4. Business Profile
  5. Latest Form 26 AS
  6. List of Directors and Shareholders with their individual shareholding certified by a CA / CS in case of the business entity is a company
  7. Memorandum and Articles of Association of the Company
  8. Property related documents
commercial property

IDBI Bank Commercial Property Purchase loan

IDBI bank offers business loans to purchase commercial property for both ready to move and under construction property.  One can use the loan amount to purchase of resale, ready built and under construction commercial property. The loan quantum is up to Rs. 5 crore whereas to avail a loan above the same has to prove eligibility. The maximum loan amount depends on the property value. The loan amount of IDBI bank commercial property purchase loans limits to 55% of the property value which includes the registration and stamp duty charges. This loan can be availed by salaried professionals, self-employed professionals and self-employed non-professionals. This loan is a secured loan, so the loan applicants are expected to hypothecate any of their assets.

Document Required

  1. Application form with photograph
  2. Identity and Residence Proof
  3. Latest Salary-slip for last 3 months (if salaried)
  4. Education Qualification Certificates and Proof of business existence ( if self-employed)
  5. Form 16/ITR (if salaried)
  6. Last 3 years Income Tax returns
  7. Last 6 months bank statement
  8. Last 3 years Profit /Loss and Balance Sheet and income tax returns  ( if self-employed)
  9. Processing fee cheque
Loan for Commercial Property

The Bottom Line

The mentioned above are not the only banks which are offering business loans to buy commercial property. If you dream to start your business and want a business address, a business loan for commercial property can make your dream of owning a commercial property come true.