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Almost all scheduled banks and scores of Housing Finance Companies (HFCs) offer home loans to finance the purchase of home properties. Currently, the home loan interest rate starts from 7.20% p.a. for tenures of up to 30 years based on the applicant’s credit score, monthly income, loan amount, LTV ratio, job profile, employer’s profile, etc. The home loan amount can go up to 75% to 90% of the home property’s value depending on the credit profile of the loan applicant and the caps on the LTV ratios set by the lenders. At Paisabazaar.com, we help you compare the home loan interest rates and other features offered by top banks and HFCs and make online applications for the best home loan options.

Here is the list of top lenders that offer home loans at lowest interest rates in India:

Name of Lender

Interest Rates (p.a.)

Processing Fees

Bajaj Housing Finance

7.20% onwards

0.3% of loan amount

Bandhan Bank (GRUH Home Loan)

7.30% - 13.50%

0.25% - 1% of loan amount

Bank of Maharashtra

7.30% - 9.45%

0.25% of loan amount (Up to Rs 25,000)

Indian Bank

7.40% - 8.45%

Up to 1% of loan amount

Union Bank of India

7.90% - 9.65%

Up to 0.5% of loan amount (Up to Rs 15,000) 

Standard Chartered

7.49% onwards

0.5% - 1% of loan amount

PNB Housing Finance

7.50% - 16.75%

Up to 1% of loan amount 

LIC Housing Finance

7.50% - 9.00%

0.35% of loan amount (Max. Rs 50,000)

Kotak Mahindra Bank

7.99% onwards

Up to 1% of loan amount

Godrej Housing Finance

7.54% – 10.99%

Up to 3% of loan amount

Interest rates as of 12th August 2022

Apply for Home Loan at Attractive Interest Rates

Name of Lender

Interest Rates (p.a.)

Processing Fees

State Bank of India

7.55% – 8.55%

0.35% of loan amount (Rs 2,000 - Rs 10,000)

(50% waiver in basic processing fee)

Axis Bank

7.60% – 12.50%

Up to 1% of loan amount (Min. Rs 10,000)

Indiabulls Housing Finance

7.60% onwards

0.5% onwards

L&T Housing Finance

7.70% – 8.70%

Up to 2% of loan amount

Repco Home Finance

7.70% onwards

1% of loan amount

Tata Capital Housing Finance

7.75% onwards

Up to 0.5% of loan amount

Bank of India

7.80% - 9.65%

Up to 0.5% of loan amount

Karnataka Bank

7.89% – 9.24%

0.5% of loan amount

UCO Bank

7.90% – 8.10%

0.5% of loan amount (Rs 1,500 - Rs 15,000)

Punjab & Sind Bank

7.90% - 9.00%

Up to 0.25% of loan amount 

Punjab National Bank

7.90% – 9.35%

0.35% of the loan amount (Rs 2,500 - Rs 15,000)

Tamilnad Mercantile Bank

7.95% onwards

0.5% of loan amount

Bank of Baroda

7.95% – 9.70%

0.5% of loan amount (Rs 8,500 - Rs 15,000)

Aditya Birla Capital

8.00% – 12.50%

Up to 1% of loan amount

Home First Finance

8.00% – 18.00%

Rs 2,500

Karur Vysya Bank

8.05% – 10.25%

Rs 2,500 - Rs 7,500

Canara Bank

8.05% – 12.85%

0.5% of loan amount (Rs 1,500 - Rs 10,000)

HDFC Ltd.

8.10% – 9.10%

(Discounted processing fee of Rs 2,000 valid till 31st August 2022)

 

For Salaried/Self-employed Professionals: Up to 0.5% of loan amount or Rs 3,000, whichever is higher

 

For Self-employed Non-Professionals: Up to 1.5% of loan amount or Rs 4,500, whichever is higher

ICICI Bank

8.10% – 9.10%

0.5% - 2% of loan amount

GIC Housing Finance

8.20% onwards

Rs 3,000

South Indian Bank

8.25% – 11.00%

0.5% of loan amount (Rs 5,000 - Rs 10,000)

Dhanlaxmi Bank

8.35% – 9.50%

1% of loan amount (Min. Rs 10,000)

Indian Overseas Bank

8.45% – 8.80%

0.5% of loan amount (Max. Rs 25,000)

RBL Bank

8.70% – 12.00%

1.5% of loan amount

Federal Bank

9.05% – 9.20%

0.5% (Rs 10,000 - Rs 45,000)

ICICI Home Finance

9.20% onwards

Up to 0.75% of loan amount or Rs 11,000, whichever is higher

Interest rates as of 12th August 2022

Use Paisabazaar’s home loan EMI calculator to calculate the loan EMI instantly. The online loan calculator gives results on the basis of principal amount, interest rate and tenure. The loan calculator also displays total interest payable, total principal payable and amortization schedule to help you understand your home loan repayment better.

Home loan eligibility differs across lending institutions and loan schemes. However, a common set of housing loan eligibility criteria is given below:

Nationality Indian Residents, Non-Resident Indians (NRIs), and Persons of Indian Origin (PIOs)
Credit Score Preferably 750 and above
Age Limit 18 - 70 years
Work Experience At least 2 years (for salaried)
Business Continuity At least 3 years (for self-employed)
Minimum Salary At least Rs. 25,000 per month (varies across lenders & locations)
Loan Amount Up to 90% of property value 

Note: Apart from the above parameters, your home loan eligibility also depends on the property you are buying and the location of the property.

  • Home Purchase Loan: Usually availed for buying ready-to-move-in properties, under-construction properties and pre-owned homes/resale properties.
  • Composite Loan: Availed for buying a plot for house construction. The first disbursement is made towards plot purchase. Subsequent payments depend on the stages of construction of the house.
  • Home Construction Loan: Availed for constructing a house on an already owned plot. The disbursements depend on the stages of construction of the house.
  • Home Renovation/Improvement Loan: For meeting home renovation costs of an existing house. The interest rate for a home renovation loan and a regular home loan are usually same.
  • Home Extension Loan: For those requiring funds to add more space to their existing house. In this, lenders usually lend 75% - 90% of the construction estimate, depending on the loan amount and LTV ratio.
  • Bridge Loan: It is a short-term home loan suitable for individuals planning to buy a new house with the sale proceeds of their existing house.
  • Interest Saver Loan: Here, the borrowers’ home loan account is linked to their bank account. Any amount deposited in the bank account over and above the EMI is considered as a prepayment towards the loan, thus, saving on the interest amount.
  • Step Up Loan: In this borrowers pay lower EMIs during the initial years of the loan tenure and have the provision of increasing the EMI amount over time. This makes the loan affordable for young professionals who have just started their career.
Particulars Charges
Processing Fee 1% - 2% of loan amount
Foreclosure/Prepayment Charges For floating rate: Nil
For fixed rate: Around 2% - 4% on the principal outstanding
Overdue Charges on EMI 2% per month of the unpaid EMI
EMI Bounce Charges Around Rs 400
Legal Fee As per Actuals

Check:- Home loan processing fees and charges of top banks and HFCs.

Proof of Identity: Copy of any one (PAN Card, Passport, Aadhaar Card, Voter’s ID Card, and Driving License)

Proof of Age: Copy of any one (Aadhaar Card, PAN Card, Passport, Birth Certificate, 10th Class Mark-sheet, Bank Passbook, and Driving License)

Proof of Residence: Copy of anyone (Bank Passbook, Voter’s ID, Ration Card. Passport, Utility Bills (Telephone Bill, Electricity Bill, Water Bill, Gas Bill) and LIC Policy Receipt

Proof of Income for Salaried: Copy of Form 16, latest payslips, IT returns (ITR) of past 3 years, and investment proofs (if any)Proof of Income for Self Employed: Details of ITR  of last 3 years, Balance Sheet and Profit & Loss Account Statement of the Company/Firm, Business License Details, and Proof of Business Address

Property-related Documents: NOC from Society/Builder, detailed estimate of the cost of construction of the house, registered sale deed, allotment letter, and an approved copy of the building plan.

Note: The above list is indicative and your lender might ask for additional documents.

Also Check: The complete checklist of the home loan documents required

 

The Government of India offers tax benefits on home loans under the Income Tax Act of 1961. These home loan tax benefits help borrowers save a substantial amount of money every year. Below are the tax benefits that you can get on your home loan EMI payments:

Section of Income Tax Act Nature of Home Loan Tax Deduction Max. Tax Deductible Amt.
Section 24(b) Interest paid Rs. 2 lakh
Section 80C Principal (including stamp duty and registration fee) Rs. 1.5 lakh

At Paisabazaar.com, you can compare and apply for eligible home loan offers in three simple steps:

Step 1- Share Your Details

Enter personal information as well as the details related to your loan requirements.

Step 2- View Offers

As per the details shared, a list of eligible home loan offers will appear. Compare interest rate, processing fee, and eligible loan amount from the list of eligible home loan offers.

Step 3- Submit the Application

Apply for the home loan offer that suits your loan requirements the best. 

Once your application is successfully submitted, you will get a confirmation of your home loan application along with a reference number for future reference. Next, our loan expert will get in touch within 24 hours to take this application forward.

Click here to apply for home loan online

1. Can I get a home loan for the entire property value?

Ans. No, you cannot get a home loan for the entire property value as the Reserve Bank of India (RBI) has capped the Loan-to-Value (LTV) ratio of housing loans. As per the RBI guidelines, the LTV ratio can go up to 90% of the property value for loan amounts up to Rs 30 lakh; for loan amounts above Rs 30 lakh and up to Rs 75 lakh, the LTV ratio limit is up to 80% of the property value and for loan amounts above Rs 75 lakh, the LTV ratio can go up to 75% of the property value. This implies that at least 10% of the remaining value must be shelled out by the borrower as down payment.

Subject to the caps set by the RBI on LTV ratios, banks/HFCs further fix the LTV ratio on the basis of the risk assessment and credit profile of the loan applicant. Those with lower creditworthiness are usually offered lower LTV ratio.

2. How do lenders check the EMI affordability for their home loan applicants?

Ans. Lenders consider the repayment capacity of home loan applicants while evaluating their loan application and loan amount eligibility. Home loan lenders usually prefer lending to home loan applicants having total EMIs, including EMI of the proposed home loan, to be within 50-60% of their monthly income. Hence, home loan applicants can use online home loan EMI calculator to find out the optimum home loan amount and tenure based on their repayment capacity.

3. How much credit score should I have to get a housing loan?

Ans. Lenders prefer sanctioning housing loans to applicants having credit scores of 750 and above as such high credit scores reflect responsible credit behaviour and reduce credit risk for lenders. This is also the reason why many lenders offer lower home loan interest rates to applicants having high credit scores.

4. Who can co-sign a home loan?

Ans. Your spouse or blood relatives such as your father, mother, siblings and children can co-sign a home loan with you. Also, all co-owners of the property must be co-applicants in housing loan.

5. Are there any prepayment charges in case of a home loan?

Ans. In the case of floating rate home loans, lenders don't charge a pre-payment penalty as per RBI directives. However, lenders may levy prepayment penalty in case of prepayment of fixed rate home loans.

6. What is a home loan balance transfer?

Ans. Home loan balance transfer allows existing home loan borrowers to transfer their outstanding home loans to a new lender at lower interest rates and/or better loan terms. This facility is especially helpful for those borrowers who had availed housing loans at higher interest rates but are now eligible for lower interest rates due to their improved credit profile or reduction in market interest rates.

7. Can I take two home loans at the same time?

Ans. Yes, if the lender of your second home loan is satisfied with your repayment capacity, credit profile and the characteristics of the pledged property, you can avail a second house loan for another property.

8. How long does it take to get a home loan sanctioned?

Ans. Usually, it takes 1 to 2 weeks for lenders to sanction a housing loan. However, it may significantly vary depending on banks/HFCs loan approval process, credit profile of the applicant and the features of the property to be purchased/ constructed.

Know more about your lender’s home loan eligibility requirements and documentation process so that you're prepared in advance, which in turn can reduce the time taken for loan approval process.

9. What is the difference between a fixed rate and floating rate home loan?

Ans. In a fixed rate home loan, the rate of interest applicable at the time of loan disbursal remains same throughout the loan period. As the interest rates remain the same throughout the loan tenure, you will be shielded from interest rates increases during the loan tenure. However, at any time during the loan tenure, if the lending rates fall, the fixed interest rates will remain unchanged, giving you no benefit of the reduced EMIs.

In case of floating rate home loans, the interest rates are subject to change as per the changes in the linked benchmark rates used by the lenders. Floating interest rate home loans are usually cheaper than the fixed interest rate home loans and the RBI mandates no prepayment or foreclosure charges for individuals borrowing a floating rate home loan.

10. Can I prepay my outstanding housing loan amount?

Ans. Yes, you can prepay your home loan. If you have floating rate home loans, no prepayment charges will be levied. However, in case of fixed rate home loans, lenders might levy around 2% to 4% of the prepayment charges.

11. Can I avail tax deductions on my home loan?

Ans. Yes. The repayment of principal amount would qualify for tax deductions under Section 80C of Income Tax Act. The repayment of interest component would qualify for tax deduction under Section 24(b) of the IT Act.

12. Can I switch from a fixed rate to a floating rate during my home loan tenure?

Ans. Yes, most lenders offering home loans at both fixed and floating rates allow their existing home loan borrowers to convert their fixed rate loans into floating rate loans and vice versa, on the payment of conversion or switching fee.

13. Which bank offers the best home loan interest rates?

Ans. To most consumer, lenders offering best home loan interest rates would be synonymous with the lender offering lowest interest. However, lenders set home loan interest rates for their loan applicants based on their credit risk assessment. As the credit risk assessment process followed by the lenders can vary widely, home loan applicants should compare the home loan offerings of as many lenders as possible to get the best possible home loan rates available on their credit profile.

Current Home Loan Interest Rates in India, 2022

Name of Lender Interest Rates (p.a.) Processing Fees
Bajaj Housing Finance 7.20% onwards 0.3% of loan amount
Bandhan Bank (GRUH Home Loan) 7.30% - 13.50% 0.25% - 1% of loan amount
Bank of India 7.30% - 9.15% 0.25% of loan amount (Rs 1,500 - Rs 20,000) 
Bank of Maharashtra 7.30% - 9.45% 0.25% of loan amount (Up to Rs 25,000)
Indian Bank 7.40% - 8.45% Up to 1% of loan amount
Union Bank of India 7.90% - 9.85% Up to 0.5% of loan amount (Up to Rs 15,000) 
Standard Chartered 7.49% onwards 0.5% - 1% of loan amount
PNB Housing Finance 7.50% - 16.75% Up to 1% of loan amount 
LIC Housing Finance 7.50% - 9.00% 0.35% of loan amount (Max. Rs 50,000)
Kotak Mahindra Bank 7.99% onwards Up to 1% of loan amount
Godrej Housing Finance 7.54% – 10.99% Up to 3% of loan amount
State Bank of India 7.55% – 8.55% 0.35% of loan amount (Rs 2,000 - Rs 10,000)
(50% waiver in basic processing fee)
Axis Bank 7.60% – 12.50% Up to 1% of loan amount (Min. Rs 10,000)
Indiabulls Housing Finance 7.60% onwards 0.5% onwards
L&T Housing Finance 7.70% – 8.70% Up to 2% of loan amount
Repco Home Finance 7.70% onwards 1% of loan amount
Tata Capital Housing Finance 7.75% onwards Up to 0.5% of loan amount
Karnataka Bank 7.89% – 9.24% 0.5% of loan amount
UCO Bank 7.90% – 8.10% 0.5% of loan amount (Rs 1,500 - Rs 15,000)
Punjab & Sind Bank 7.90% - 9.00% Up to 0.25% of loan amount 
Punjab National Bank 7.90% – 9.35% 0.35% of the loan amount (Rs 2,500 - Rs 15,000)
Tamilnad Mercantile Bank 7.95% 0.5% of loan amount
Bank of Baroda 7.95% – 9.70% 0.5% of loan amount (Rs 8,500 - Rs 15,000)
Aditya Birla Capital 8.00% – 12.50% Up to 1% of loan amount
Home First Finance 8.00% – 18.00% Rs 2,500
Karur Vysya Bank 8.05% – 10.25% Rs 2,500 - Rs 7,500
Canara Bank 8.05% – 12.85% 0.5% of loan amount (Rs 1,500 - Rs 10,000)
HDFC Ltd. 8.10% – 9.10% (Discounted processing fee of Rs 2,000 valid till 31st August 2022)
For Salaried/Self-employed Professionals: Up to 0.5% of loan amount or Rs 3,000, whichever is higher
For Self-employed Non-Professionals: Up to 1.5% of loan amount or Rs 4,500, whichever is higher
ICICI Bank 8.10% – 9.10% 0.5% - 2% of loan amount
GIC Housing Finance 8.20% onwards Rs 3,000
South Indian Bank 8.25% – 11.00% 0.5% of loan amount (Rs 5,000 - Rs 10,000)
Dhanlaxmi Bank 8.35% – 9.50% 1% of loan amount (Min. Rs 10,000)
Indian Overseas Bank 8.45% – 8.80% 0.5% of loan amount (Max. Rs 25,000)
RBL Bank 8.70% – 12.00% 1.5% of loan amount
Federal Bank 9.05% – 9.20% 0.5% (Rs 10,000 - Rs 45,000)
ICICI Home Finance 9.20% onwards Up to 0.75% of loan amount or Rs 11,000, whichever is higher

Interest rates for all lenders as on 10th Aug 2022. Housing loan interest rates in the table are subject to change anytime without prior notice. Home loan rates in the table are subject to the credit/ risk profile as assessed by the lender on the basis of parameters such as credit scores, age and repayment capacity of the applicant.

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