Hi
When i try to take off in Loiter mode the motors start spinning after the throttle stick passes mid range.is this normal?
yes, half stick is to maitain altitude, if your on the ground it can do this with out spinning props, once you go above half it is trynig to gain altitude so will spinnup the props.
note that the props should still be spinning at the value of your spin armed parameter what ever the mode is.