Home Loan Interest Rate: In the diverse landscape of Indian banking, home loan interest rates play a pivotal role in determining the affordability and accessibility of homeownership. Various financial institutions, both GOVT and private, offer a range of interest rates to cater to the diverse needs and profiles of potential homebuyers.
Table of Contents
State Bank of India (SBI), being one of the largest public sector banks, typically provides competitive home loan interest rates that can vary based on factors such as the loan amount and the applicant’s financial history. HDFC Bank, a prominent private sector player, also offers a competitive Home Loan Interest Rate, with a starting point of around [8.50]%.
ICICI Bank, Axis Bank, Bank of Baroda, Punjab National Bank (PNB), Canara Bank, IDBI Bank, Kotak Mahindra Bank, and Federal Bank are among the other major players in the Indian banking sector, each offering its unique set of Home Loan Interest Rate. These rates often commence at approximately [9.00]% and can fluctuate depending on market conditions and individual customer profiles.
Home Loan Interest Rate of all Banks 2023
|Banks||Starting Interest Rate (p.a.)||Processing Fees|
|Kotak Mahindra Bank||8.75% p.a. onwards||2%|
|Union Bank of India||8.70% p.a. onwards||0.50% of the loan amount|
|Bank of Baroda||8.60% p.a. onwards||Up to 0.50% (Min. Rs. 8,500; Max. Rs. 25,000)|
|Central Bank of India||8.35% p.a. onwards||NIL or up to 0.50%|
|Bank of India||8.45% p.a. onwards||Up to 0.25% for individuals (Min. Rs. 1,500; Max. Rs. 20,000)|
|State Bank of India||8.40% p.a. onwards||0.17%|
|HDFC Home Loans||8.45% p.a. onwards*||0.5% or Rs.3,000 whichever is higher|
|LIC Housing Finance||8.45% p.a. onwards||Up to 0.50%|
|Axis Bank||9.00% p.a. onwards||Up to 1% or min. Rs. 10,000|
|Canara Bank||9.25% p.a. onwards||0.50% of the loan amount (min. Rs. 1,500 and max. Rs. 10,000)|
|Punjab and Sind Bank||8.95% p.a. onwards||Full Waiver|
|IDFC First Bank||8.85% p.a. onwards||Up to 3% of the overall loan amount|
|Bank of Maharashtra||8.60% p.a. onwards||0.15% of the loan amount subject to a maximum of Rs. 25,000|
|Indian Overseas Bank||9.55% p.a. onwards||0.15% of the loan amount subject to a maximum of Rs. 25,000|
|Punjab National Bank||8.50% p.a. onwards||0.35% (Max Rs. 15,000)|
|UCO Bank||8.75% p.a. onwards||0.5% of loan amount min. Rs. 1500 and max. Rs. 15,000|
|IDBI Bank||8.65% p.a.||0.50% (Rs. 2,500 – Rs.5,000)|
|HSBC Bank||8.75% p.a. onwards||1% of loan amount or Rs. 10,000, whichever is higher|
|Karur Vysya Bank||7.15% p.a. onwards||1% of loan amount or Rs. 10,000, whichever is higher|
|Saraswat Bank Home Loan||8.60% p.a. onwards||Up to Rs. 35 lakh: NilRs. 35 lakh – Rs. 50 lakh: 0.30% of loan amountRs. 50 lakh – Rs. 70 lakh: 0.40% of loan amountRs. 70 lakh – Rs. 1.40 lakh: 0.50% of loan amount|
|Jammu and Kashmir Bank||8.75% p.a. onwards||0.25% + GST (min. Rs. 5,000 and max. Rs. 50,000)|
|South Indian Bank||Repo Rate + 3.35% p.a. onwards||0.50% of the loan amount or a minimum of Rs. 5,000 + GST|
|PNB Housing Finance Limited||8.75% p.a. onwards||Up to 0.50%|
|Federal Bank||8.80% p.a. onwards||Housing Loan: 0.50% of the loan amount (min. Rs. 3,000 and max. Rs. 7,500)Property Power Loan: 1% of loan amount (min. Rs. 3,000)|
|Standard Chartered Bank||8.75% p.a. onwards||1%|
|Aavas Financiers||Contact the bank||1.00%|
|Karnataka Bank||8.75% p.a. onwards||Contact the bank|
|Sundaram Home Finance||7.85% p.a.||Rs.3,000 (for salaried)|
|Dhanlaxmi Bank||ranges up to 15% p.a.||1% of the loan amount|
|Tata Capital||8.60% p.a. onwards||0.50%|
|Tamilnad Mercantile Bank||9.35% p.a. onwards||0.50%|
|Bandhan Bank||9.15% p.a. onwards||Contact the bank|
|Yes Bank||9.40% p.a. to 10.25% p.a.||2% of the loan amount plus GST or Rs. 10,000, whichever is higher|
|Hudco Home Loan||8.95% p.a. onwards||NA|
|Indiabulls||8.75% p.a. onwards||0.50% onwards|
|Aditya Birla||8.80% p.a. onwards||Up to 1%|
|GIC Housing Finance||8.80% p.a. onwards||8.80% p.a. onwards|
|Reliance Home Finance||9.75% p.a onwards||Up to 2%|
|Shriram Housing||10.49% p.a. onwards||NA|
|India Shelter Finance||13.00% p.a. to 20% p.a.||2.00% to 3%|
How to Calculate Home Loan Interest Rate?
Home loans often have a long repayment period, therefore it’s critical to calculate your first total interest liability.
One of the two approaches given below can be used to calculate the same thing:
EMI CALCULATOR: You may easily use a home loan EMI calculator to figure out the interest rate that will be charged on your mortgage. The fields on the calculator must be filled out using the information listed below:
After entering the necessary information, click the “Calculate” button to acquire a complete breakdown of your loan, including the amount due in interest.
- Home Loan Amount
- Loan Repayment Tenure
- Rate of Interest
- EMI Calculation Formula: Calculating your EMI might seem complex, but it can be broken down into a straightforward formula:
- EMI = [P x R x (1+R)^N] / [(1+R)^N-1]
- EMI = Equated Monthly Installment
- P = Principal Loan Amount
- R = Monthly Interest Rate (Annual Interest Rate divided by 12 and multiplied by 100)
- N = Loan Tenure in Months
Home loan calculator
Factors Affecting Interest Liability
Several factors can influence your interest liability:
- Loan Term: Longer loan terms generally result in higher overall interest payments.
- Interest Rate: Higher interest rates lead to more significant interest liabilities.
- Loan Amount: Borrowing a larger sum will increase your overall interest payments.
- Payment Frequency: Making biweekly payments instead of monthly ones can reduce your interest liability over time.
Types of Interest Rates in Home Loan
Most banks primarily charge two types of interest rates for house loans.
1. Fixed Interest Rate:
The rate is constant in this method of calculation throughout the entire loan term. Since the rate is still constant, there won’t be any changes to the interest fees. Depending on the offer, you might be able to change to the floating rate system after the loan tenure has been completed for a specific amount of time.
2. Floating Interest Rate:
Your home loan’s interest rate is based on the bank’s current average lending rates. The rate is based on the bank’s most recent stated rate, which in turn is influenced by a number of variables, including adjustments to the RBI’s monetary policy and lending rate as well as the bank’s reaction to the modification.
Determining Factors for Your Home Loan Interest Rate
When applying for a home loan, it’s important to understand the Various type of factors that lenders consider while assessing your eligibility and determining the interest rate.
Banks and Housing Finance Companies (HFCs) carefully assess your credit history, repayment capacity, income, and property details because home loans entail significant sums of money. It should be noted that higher eligibility requirements frequently accompany lower interest rates. The following are the main elements that lenders consider:
- Credit Score
- Income and Employment
- Loan Amount
- Type of Home Loan
- Interest Rate Concession for Women Borrower
- Type of Interest Rate
what is the interest rate on home loans?
The proportion of the principal amount that the lender charges the borrower for using the principal amount is known as the home loan interest rate. The cost of your home loan is determined by the interest rate that banks and other non-financial entities charge. Therefore, the interest rate imposed decides how much you have to pay your lender against your loan each month when you make your home loan EMI (equated monthly payment). Interest rates can differ from lender to loan and are typically correlated with repo rates.
Which bank has the lowest home loan interest rate?
The Bank of Maharashtra now offers its customers the lowest home loan interest rate in the industry at 8.40% per year, despite the fact that interest rates supplied by banks are subject to change at any time. Please take note that this rate only applies to women who are applying for home loans.
what is the current interest rate for home loans?
the home loan interest rates in India typically range from approximately 8.5% to 10.5% per annum, depending on the specific lender, loan amount, and borrower’s creditworthiness. However, please note that interest rates can change frequently due to market dynamics and economic conditions. Therefore, it’s advisable to check with individual banks or financial institutions or visit their official websites for the most up-to-date information on current home loan interest rates in India.
How to reduce home loan interest?
To reduce home loan interest, consider making regular prepayments, opting for a shorter loan tenure, improving your credit score, and refinancing if favorable rates become available. These strategies can help lower the overall cost of your home loan.
Which bank has the lowest rate of interest for the businessman or self-employed?
The banks Bank of India and SBI have competitive interest rates starting at 6.85% p.a. and 8.05% p.a., respectively, for self-employed professionals and non-professionals.
How can I check the total interest payout for my housing loan?
Check your total interest payment against your loan with a home loan EMI calculator. All you need to do is enter the loan amount, term, and interest rate. You can examine your EMI as well as a thorough breakdown of your repayment timeline using an amortization table after the computation. Check the amount of interest you have paid on your loan using the amortization table that represents your repayment schedule.