A mortgage loan, also known as a loan against property, is one of the most common ways for Nepalese people to access a large amount of money whenever needed.
Now, most people do know the basics, like you keep your house or land as collateral to borrow the money. However, when it comes to the actual process of comparing offers, calculating how much you can borrow, and the paperwork, many quickly become confused.
Depending on the banks, the mortgage loan offers vary, meaning interest rates, conditions, and charges differ from one bank to another. And if you don’t compare properly, you could miss the cheaper loan options.
But don’t worry! To help you avoid such costly mistakes, we, Saral Banking Sewa, have brought this A to Z mortgage loan application guide. Here, you can learn about the required documents, eligibility criteria, step-by-step application process, current interest rates, and bank comparison.
Before visiting the bank for a mortgage loan, it’s important that you know exactly which documents to take with you so that you don’t end up going back and forth just because something’s missing.
Now, the exact list can vary slightly from one bank to another. However, most banks in Nepal have a similar set of document requirements for a mortgage loan.
Want a checklist of all required documents? Click here.
Apart from the collateral valuation, banks also take a look at your financial standing and whether you are capable of paying the mortgage loan back. That’s why they check a few basic eligibility criteria before processing your mortgage application.
Here are the most common things banks in Nepal often consider before giving a mortgage loan:
If you want to check mortgage loan eligibility depending on your income, use our eligibility checker tool.
Applying for a mortgage loan might seem complicated at first, but once you know the process, it’s actually simple. Here’s a step-by-step breakdown of how it works — from comparing rates to getting the loan amount in your account.
Before anything else, it’s always best to see what different banks are offering, as oftentimes, interest rates, processing fees, loan amounts, and repayment terms of a mortgage loan can vary a lot.
For instance, Nepal Bank Limited currently has an interest rate of 8.26% to 10.26% while Prabhu Bank has 9.68% to 11.68% on their mortgage loan options. While the difference may not seem significant in terms of interest, in the long run, the amount you have to pay becomes significantly higher.
So, always ensure to compare various mortgage loan options in Nepal beforehand. To do the comparison, you can use our loan comparison tool, where you can compare commercial and development banks’ mortgage loans in one place.
Considering interest rates, tenure flexibility, and processing duration, choose the option that best fits your needs. But keep in mind: sometimes the cheapest interest rate isn't always the best deal.
So, ensure to check all charges, service fees, and prepayment penalties in addition to the interest rate.
Now that you’ve selected a bank, gather all necessary documents (citizenship, land ownership papers, income proof, etc.) and submit them along with the loan application form by visiting the nearest branch of the bank.
The bank will arrange a physical inspection of the property you’re mortgaging. They’ll also conduct a valuation, which is usually through an independent assessor, to determine how much loan you can be approved for based on your property's worth.
Remember, most banks charge additional fees for this property valuation process. Therefore, make sure your budget plan includes this additional cost as well.
Once your documents and valuation reports are complete, the internal team of the bank will review and assess everything: your income, liabilities, credit history, and risk profile. Depending on the bank, this step may take a few working days.
If everything checks out, the bank will approve your loan. You’ll then be asked to sign a formal loan agreement, which includes all terms and conditions, so make sure you review the fine print carefully before signing.
After that, you’ll need to register a mortgage deed at the local Land Revenue Office (Malpot), showing that the property is officially pledged to the bank until the loan is repaid.
Once the mortgage deed is submitted and verified, the bank releases the approved loan amount, either into your account or as per the agreed terms.
As of Asar 2082, mortgage loan interest rates in Nepal offered by 20 commercial banks range from 5.97% to 14.50%. And the best bank in terms of cheaper interest rates on a mortgage loan is Global IME Bank, with interest rates of 5.97% to 9.47%. Following that, Agriculture Development, Everest, Siddhartha, and Machhapuchhre Bank have lower interest rates ranging between 6.03% and 8.35%.
Here is a brief overview of the mortgage loan interest rates of various banks in Nepal, Ashad, 2082.
| Bank | Interest Rate | Tenure | Processing Fee | |
| Floating | Fixed | |||
| Global IME | 5.97% to 9.47% | 10.99% to 11.99% | Up to 5 Years | 0.75% |
| 11.99% to 12.99% | Above 5 Years | |||
| Agriculture Development Bank | 6.03% to 9.03% | 10.65% | - | 0.75% |
| Everest Bank | 6.35% to 8.35% | 11.99% | Up to 7 Years | 0.75% |
| Siddhartha Bank | 6.35% to 9.60% | 10.75% | Up to 5 Years | 0.75% |
| 11.25% | Between 5 and 10 Years | |||
| 11.25% | Above 10 Years | |||
| Citizens Bank | 6.53% to 9.53% | 10.50% | Under 5 Years | 0.75% |
| 11% | For 6 to 10 Years | |||
| 11.50% | For 11 to 15 Years | |||
| Machhapuchchhre Bank | 7.35% to 9.35% | 10.00% | Under 5 Years | 0.75% |
| 11.00% | For 6 to 10 Years | |||
| 11.50% | For 11 to 15 Years | |||
If you want to find out mortgage loan rates in other banks and compare them side by side, use our mortgage loan comparison tool in Saral Banking Sewa.
As mortgage loans are often a big commitment that lasts for a long time, affecting your finances, you must not rush and make a hasty decision to avoid regrets later. Therefore, here are a few things you should be aware of before you apply.
A mortgage loan can be a smart way to unlock the value of your property. However, only if you go in prepared. So, don’t rush into the first offer that comes your way or someone suggests it.
Take time to compare rates, understand the repayment terms, and calculate what you can actually afford to pay each month. Make sure your land and legal documents are in order, and don’t hesitate to get legal advice before signing anything.
A little caution now can save you from big headaches later. And if you want to make the comparison process easier, Saral Banking Sewa is here to help; unbiased, fast, and built to guide you toward better financial decisions.
The mortgage loan process in Nepal involves submitting required documents, property valuation, loan appraisal, approval, mortgage deed registration, and finally, loan disbursement. However, the exact steps may vary slightly depending on the bank.
To apply for a mortgage loan in Nepal, you need documents like citizenship, land ownership papers (Lalpurja), updated tax receipts, income proof, and property valuation reports.
In Nepal, the loan amount you can borrow through a mortgage usually depends on your property's market value and your income. Most banks offer up to 60–70% of the property's appraised value.
While there is no fixed minimum salary requirement for a mortgage loan in Nepal, banks generally consider whether your stable source of income is sufficient to pay the EMI.
You can get a 2 lakh loan in Nepal via a mortgage loan or a loan against property. Similarly, you can also get it by applying for a gold loan if you have enough gold.
