Lease-Rental Discounting or LRD as it is popularly known is a term loan that is provided against the rental receipts. It Is availed by owners of property against assets they have leased to tenants. You can take a LRD loan if you have a property that gives you rent every month. The lender provides an advance against the future rent income that the owner is going to receive. The lender discounts the future rental income and considers the value of the underlying property and offers you the loan. LRD helps the owner to access funding at cheap rates. This way if the owner has a requirement for money he can take LRD loan instead of selling the property.

The tenure of the loan depends on the lease contract and the remaining lease period. The interest rate on LRD depends on the quality of tenant, the profile of the owner and the location and grade of the property. The loan can be availed on Residential or Commercial property which is let out on rent.