Access to the right pools
We know which NBFC-HFCs and Category-II AIFs actually fund raw land — and which have appetite for your location and asset class right now.
The stage your bank legally can’t fund.
Land Acquisition Finance for Developers
RBI bars banks from funding a private builder’s land purchase — so the capital has to come from NBFC-HFCs and Category-II AIFs. We place the file with the lenders whose mandate covers raw land, at the right LTV, and plan the bridge into cheaper construction finance from day one. CA + ex-banker led. ₹4,250 Cr+ facilitated since 2011.
Banks-can’t capitalNBFC-HFC & AIFBridged into CF
A track record since 2011, in numbers
₹4,250 Cr+
Capital facilitated across sectors₹550 Cr
Largest single facility structured2 pools
NBFC-HFCs · Cat-II AIFs fund landSince 2011
Advising developers & promotersYour bank legally cannot lend you money to buy land. The RBI Master Circular on Housing Finance bars banks from funding private builders’ land acquisition — but NBFC-HFCs (NHB/RBI-regulated) and SEBI Category-II AIFs face no such bar. Getting the right one on the file, at a sensible LTV, is the whole game at this stage.
Finnova Advisory is an advisory firm — we structure the file and negotiate terms; the lender sanctions and disburses.
The facility at a glance
What land acquisition finance typically looks like
Indicative parameters for early-stage land funding. The LTV is lower and the rate higher than construction finance, because this is the riskiest point in the project’s life — before approvals and sales.
Loan-to-value (LTV)~40–55%Of land value — early-stage risk
Interest rate~14–18% p.a.Prices the pre-approval stage
Tenor2–4 yearsUntil bridged into construction
ExitBridge to CFRefinanced once RERA + approvals land
Minimum ticket~₹50 CrStage-dependent
SecurityLand mortgagePlus SPV charge, guarantees
Indicative only — not an offer. LTV, rate and tenor vary by location, title quality, development potential and sponsor track record. We tell you the bankable figure at diligence.
Who funds land
Banks are out — here’s who is in
The defining fact of land-stage funding is regulatory: banks are prohibited, so the capital comes from two pools. Matching the right one to your title, LTV and timeline is what gets the file funded.
Capital poolWhat they fundLTVRateNotes
NBFC-HFCsPrimary route FundsLand, TDR, premium, construction LTV~40–55% Rate~14–17% p.a. NotesNHB/RBI-regulated; permitted to lend for land
Category-II AIFs FundsLand, structured & special situations LTVStructured Rate~15–18%+ NotesSEBI-regulated; mezzanine where LTV/speed stretches HFCs
The smart structure plans the exit upfront: fund land via an NBFC-HFC or AIF now, then refinance into a cheaper bank construction facility the moment RERA and approvals are in place.
Why Finnova
The advisor who knows the stage banks won’t touch
Land funding is a specialist market — fewer lenders, sharper pricing, title-sensitive. Six reasons developers run it through us.
Title-first underwriting
A clean, marketable title is what sets your LTV. We pressure-test title, search report and encumbrances before the file goes in, so pricing isn’t penalised for avoidable doubt.
The exit planned upfront
We structure land debt so it bridges cleanly into bank construction finance — compressing your cost of capital instead of trapping it at 16%.
LTV & pricing leverage
We run a competitive process across the few lenders in this space, so you don’t take the first term sheet at the first rate.
CA + ex-banker on the file
The people modelling the deal and negotiating security have sat on both sides of a credit committee.
One advisor, whole lifecycle
Land today, construction, inventory and refinance later — sequenced under one desk, not renegotiated stage by stage.
Eligibility & documentation
What a fundable land file needs
At land stage, title and development potential carry the file. Here is what we assemble and pressure-test before approaching a lender.
Documents we assemble & pressure-test
- Land title documents and chain of title
- Title search report and encumbrance certificate
- Agreement to sell / sale deed and land cost
- Development potential — zoning, FSI, intended use
- Approval roadmap and project concept plan
- Last 3 years’ audited financials of the developer entity
- SPV structure and promoter net-worth statement
- KYC of developer, promoters and authorised signatories
Indicative — exact requirements vary by lender and location. We tell you precisely what each NBFC-HFC or AIF will want before the file goes in.
Good-fit profile
- TitleClean / marketable
- Development potentialClear
- Ticket size₹50 Cr+
- Plan to RERAMapped
Already RERA-registered with approvals? You may be ready for cheaper construction finance directly.
Process
How an engagement runs — our 5-step path
From title diligence to drawdown, with the bridge into construction planned from the start.
Title & potential diligence
3–5 daysTitle, encumbrances, zoning and development potential — we establish what’s fundable, at what LTV, before any obligation.
Lender shortlist
2 daysWe approach the NBFC-HFCs and AIFs with live appetite for land in your location and asset class.
Pack & submission
7–10 daysA CAM-ready pack and model with the title story and the planned bridge into construction finance built in.
Sanction negotiation
3–6 weeksWe negotiate LTV, pricing, security and the exit, running a competitive process across the few lenders in this space.
Documentation & drawdown
2–3 weeksLegal, mortgage, security and disbursement — and we stay on file to execute the bridge into construction finance later.
Consultation
Tell us about the land & the plan
One conversation tells you whether the land is fundable, at what LTV, from which pool — and how to bridge it into construction finance later. No pitch — a straight read from people who structure land deals every week.
Thank you — your enquiry has been submitted
We’ve received your details. A senior member of our team will review them and get back to you within one business day. Everything you’ve shared stays strictly confidential.
FAQ
Land acquisition finance, answered
No. The RBI Master Circular on Housing Finance bars banks from extending fund-based or non-fund-based facilities to private builders for acquiring land, even as part of a housing project. Banks can only fund land for public agencies. For a private developer, land capital therefore has to come from an NBFC-HFC or a SEBI-registered Category-II AIF — which face no such bar.
Indicatively 40–55% of the land value, at roughly 14–18% p.a. over a 2–4 year tenor, with tickets typically from ₹50 Cr. The LTV reflects the early, higher-risk stage — before approvals and RERA. Actual terms depend on the location, title quality, the development potential and your track record.
Because it is the riskiest stage. At land stage there is no RERA registration, often no final approvals, and no sales cash flow — so the lenders willing to fund it (NBFC-HFCs and AIFs) price for that risk at 14–18%, versus roughly 10–14% for a sanctioned construction facility. The right move is to bridge land debt into cheaper bank construction finance as soon as the project de-risks.
Usually by bridging into the construction facility. Once RERA registration and statutory approvals are in place, a bank or NBFC-HFC construction loan refinances the land debt — compressing your cost of capital as the project moves from raw land to a fundable, sanctioned project. We sequence both so the structure is planned from day one, not stitched together later.
Typically a registered mortgage over the land itself, a charge on the SPV, promoter guarantees and, where relevant, a pledge of shares. A clean, marketable title with a clear title-search report and encumbrance certificate is the single biggest factor in getting the file funded at a sensible LTV.
We are an advisory firm, not a lender. We build and pressure-test the file, place it with the NBFC-HFCs and AIFs whose mandate covers raw land, negotiate LTV, pricing and security, and plan the bridge into construction finance — the lender sanctions and disburses.
Further reading
Guides on land & early-stage funding
Why banks can't fund land, and how the capital pools sequence.