The interest rates for home loans in India can vary depending on several factors, including the lending institution, loan amount, loan tenure, and the borrower’s creditworthiness.
However, it’s important to note that interest rates are subject to change based on market conditions and the policies of lending institutions.
Therefore, it is recommended to check with specific banks or financial institutions for the most up-to-date information on home loan interest rates.
Interest Rate For Home Loan 2023
| S.No | Bank Name | Interest Rate | Processing Fee |
| 1 | HDFC Home Loans | 8.45% p.a. onwards* | 0.5% or Rs.3,000 whichever is higher |
| 2 | Axis Bank | 9.00% p.a. onwards | Up to 1% or min. Rs. 10,000 |
| 3 | Kotak Mahindra Bank | 8.75% p.a.* onwards | 2% |
| 4 | Bank of Baroda | 8.60% p.a. onwards | Up to 0.50% |
| 5 | Union Bank of India | 8.70% p.a. onwards | 0.50% of the loan amount |
| 6 | State Bank of India | 9.15% p.a. onwards | 0.35% – 1% of loan amount |
| 7 | Central Bank of India | 8.35% p.a. onwards | up to 0.50% |
| 8 | IDFC First Bank | 8.85% p.a. onwards | Up to 3% |
| 9 | LIC Housing Finance | 8.45% p.a. onwards | Up to 0.50% |
| 10 | Tata Capital | 8.60% p.a. onwards | Up to 0.50% |
| 11 | Yes Bank | 9.40% p.a. to 10.25% p.a. | 2% of the loan amount plus GST |
| 12 | Indiabulls | 8.75% p.a. onwards | 0.50% onwards |
| 13 | Shriram Housing | 10.49% p.a. onwards | Contact To Bank |
| 14 | PNB Housing Finance Limited | 8.75% p.a. onwards | Up to 0.50% |
| 15 | Punjab and Sind Bank | 8.95% p.a. onwards | Full Waiver ( Bank Offer) |
| 16 | Reliance Home Finance | 9.75% p.a onwards | Up to 2% |
| 17 | Bank of India | 8.45% p.a. onwards | Up to 0.25% for individuals |
| 18 | Punjab National Bank | 8.60% p.a. onwards | 0.35% |
| 19 | IDBI Bank | 10.20% p.a. onwards | 0.50% |
| 20 | Saraswat Bank Home Loan | 8.60% p.a. onwards | Up to 0.50 |
| 21 | Standard Chartered Bank | 8.75% p.a. onwards | 1% |
| 22 | Federal Bank | 10.10% p.a. onwards | Up to 1% |
| 23 | Canara Bank | 9.25% p.a. onwards | 0.50% |
| 24 | Bank of Maharashtra | 8.60% p.a. onwards | 0.15% (maximum of Rs. 25,000) |
| 25 | HSBC Bank | 8.75% p.a. onwards | 1% |
| 26 | Karnataka Bank | 8.75% p.a. onwards | Contact the bank |
| 27 |
Jammu and Kashmir Bank |
8.75% p.a. onwards | 0.25% + GST |
| 28 | UCO Bank | 8.75% p.a. onwards | 0.5% of the loan amount |
| 29 | Indian Overseas Bank | 9.55% p.a. onwards | 0.15% of the loan amount |
| 30 | Aditya Birla | 8.80% p.a. onwards | Up to 1% |
| 31 | Dhanlaxmi Bank | up to 15% p.a. | 1% of the loan amount |
| 32 | Sundaram Home Finance | 7.85% p.a onwards | Contact to bank |
| 33 | Bandhan Bank | 9.15% p.a. onwards | Contact the bank |
| 34 | ICICI Bank | 9.00% p.a onwards | 0.50% of the loan amount |
| 35 | South Indian Bank | Repo Rate + 3.35% p.a. onwards | 0.50% of the loan amount |
Home loan interest rate for July 2023 | Note – Interest rate and process fee are subject to change by banks
How to Calculate Interest on Home Loan?
When it comes to home loans, it’s crucial to have a clear understanding of your overall interest liability.
By calculating the interest on your home loan, you can better plan your finances and make informed decisions.
Here’s a step-by-step guide on how to calculate interest on a home loan:
Step 1: Gather Loan Details
Before you begin, gather the necessary information about your home loan, including:
Home Loan Amount: The total loan amount you have borrowed or going to apply for.
Loan Repayment Tenure: The duration or term of your loan, usually measured in months or years.
Rate of Interest: The annual interest rate applicable to your home loan.
Step 2: Use an EMI Calculator
To simplify the calculation process, utilize a Loan EMI calculator specifically designed for home loans.
You’ll typically find a form with fields to input the loan amount, tenure, and interest rate.
Step 3: Enter Loan Details
Fill in the required information accurately in the EMI calculator:
Home Loan Amount: Enter the total loan amount you have borrowed or plan to borrow.
Loan Repayment Tenure: Input the duration or term of your loan in months or years.
Rate of Interest: Enter the annual interest rate charged by the lender.
Step 4: Calculate and Review Results
Once you have entered all the necessary details, click on the “Calculate” or “Calculate EMI” button.
The result will include details such as your equated monthly instalment (EMI) amount, the total interest payable over the loan tenure, and the overall loan amount (principal + interest).
Step 5: Analyze the Results
Review the results provided by the EMI calculator. Pay attention to the interest amount, as it will give you an understanding of the total interest you will pay over the course of the loan.
This analysis will help you evaluate the affordability of the loan and make informed decisions about repayment strategies and financial planning.
It’s important to note that the EMI calculator provides an estimate, and actual loan terms and conditions may vary based on the specific terms agreed upon with your lender.
Always consult with your lender or a financial advisor to get accurate and up-to-date information regarding your home loan interest calculation.
By using an EMI calculator, you can gain valuable insights into your home loan’s interest amount, helping you plan your finances effectively and make informed decisions about your borrowing and repayment strategy.
What Factors Influencing Your Home Loan Interest Rate?
When applying for a home loan, it’s important to be aware of the factors that banks and other financial institutions consider when determining your interest rate.
The interest rate on your home loan plays a significant role in determining the overall cost of your borrowing.
Here are the key factors that lenders typically take into account:
Credit Score:
Your credit score is a reflection of your creditworthiness and repayment history.
Lenders use credit scores provided by credit bureaus such as CIBIL, Experian and Equifax to assess your creditworthiness.
A higher credit score indicates responsible credit management, which can lead to lower interest rates on your home loan.
Income and Employment:
Lenders consider your income, employment type, and employer profile to evaluate your repayment capacity.
Applicants with stable employment in government, PSUs, or large/reputed private sector organizations are often viewed more favourably by lenders.
A higher income and stable employment can increase your chances of securing a home loan at a lower interest rate.
Loan Amount:
The loan amount you intend to borrow can impact the interest rate offered.
Typically, home loans with lower loan amounts (up to Rs. 30 lakh) tend to have lower interest rates compared to higher loan amounts.
Making a substantial down payment can also help reduce the loan amount and potentially secure a lower interest rate.
Type of Home Loan:
Different types of home loans may come with varying interest rates.
Regular home loans typically have standard interest rates, while specialized loans such as Plot Loans or NRI Home Loans may have different rates.
The specific type of home loan you choose can affect the interest rate you are offered.
Type of Interest Rate:
You have the option to choose between a fixed interest rate or a floating interest rate for your home loan.
Fixed-rate home loans provide a consistent EMI throughout the loan tenure while floating rates fluctuate based on market conditions.
Fixed-rate home loans often have slightly higher interest rates due to the increased interest rate risk for the lender.
Interest Rate Concession:
Some lenders offer a special interest rate concession for women borrowers, typically around 0.05%.
If you are a married couple, considering a joint home loan with the wife as the primary applicant can potentially result in a lower interest rate.
Joint home loans can also increase eligibility and provide additional tax benefits.
It’s important to note that each lender may have their own specific criteria and policies when determining interest rates.
Additionally, market conditions and economic factors can also influence interest rates.
It is advisable to compare offers from multiple lenders, negotiate for the best rate, and carefully review the terms and conditions before finalizing your home loan.
Remember, a lower interest rate can lead to significant savings over the loan tenure, so it’s essential to be proactive in managing the factors that impact your interest rate and work towards improving your creditworthiness.
FAQ
What is a home loan?
A home loan, also known as a housing loan or mortgage, is a loan provided by banks or financial institutions to individuals or families for purchasing or constructing a residential property.
What factors determine my eligibility for a home loan?
Lenders consider factors such as your income, employment stability, credit history, age, property value, and the loan amount you are seeking when assessing your eligibility for a home loan.
What is the loan-to-value (LTV) ratio in a home loan?
The loan-to-value (LTV) ratio is the percentage of the property’s value that the lender is willing to finance.
For example, if the LTV ratio is 80%, the lender will provide a loan amount equal to 80% of the property’s value, and the remaining 20% must be contributed as a down payment by the borrower.
What is the difference between fixed and floating interest rates?
A fixed interest rate remains constant throughout the loan tenure, providing predictable monthly repayments.
In contrast, a floating interest rate fluctuates based on market conditions and benchmark rates, which can lead to varying EMIs over time.
How is my home loan interest rate determined?
The home loan interest rate is determined by various factors, including market conditions, the lender’s internal policies, your creditworthiness, loan tenure, loan amount, and the type of interest rate (fixed or floating) you choose.
Can I negotiate the home loan interest rate with the lender?
Yes, it is possible to negotiate the home loan interest rate with the lender.
Good creditworthiness, a stable income, and a strong repayment capacity can increase your chances of negotiating a better interest rate.
Can I switch my home loan to another lender to get a better interest rate?
Yes, it is possible to switch your home loan to another lender through a process called loan refinancing or balance transfer.
This allows you to take advantage of better interest rates offered by another lender, potentially reducing your overall borrowing costs.
Are there any tax benefits associated with home loans?
Yes, home loan borrowers can enjoy tax benefits under the Income Tax Act.
Deductions are available for the principal repayment (under Section 80C) and the interest paid on the home loan (under Section 24(b)).
Can I prepay my home loan?
Yes, most lenders allow borrowers to prepay their home loan partially or in full before the completion of the loan tenure.
However, prepayment charges may apply, so it’s important to check with your lender beforehand.
Can I choose a longer loan tenure to reduce my EMIs?
Opting for a longer loan tenure can reduce your EMIs but may increase the total interest paid over the loan’s duration.
It’s important to strike a balance between affordable EMIs and minimizing interest costs.
[This article is an information guide, a few updates can be delayed. Must check with the banks before applying for any loan.]
