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Current Home Loan Interest Rates of All Banks/HFCs
Home Loan Interest Rates of Top Public Sector Banks
| Name of Lender | Up to Rs. 30 Lakh | Above Rs. 30 Lakh & Up to Rs. 75 Lakh | Above Rs. 75 Lakh |
| Bank of Baroda | 8.40% – 10.65% | 8.40% – 10.65% | 8.40% – 10.90% |
| Punjab National Bank | 8.55% – 10.25% | 8.50% – 10.15% | 8.50% – 10.15% |
| Punjab & Sind Bank | 8.50% – 10.00% | 8.50% – 10.00% | 8.50% – 10.00% |
| State Bank of India | 8.40% – 10.15% | 8.40% – 10.05% | 8.40% – 10.05% |
| Union Bank of India | 8.35% – 10.80% | 8.35% – 10.95% | 8.35% – 10.95% |
| Bank of India | 8.50% – 10.75% | 8.50% – 10.75% | 8.50% – 10.75% |
| UCO Bank | 8.45% – 10.30% | 8.45% – 10.30% | 8.45% – 10.30% |
| Bank of Maharashtra | 8.50% – 11.15% | 8.50% – 11.15% | 8.50% – 11.15% |
| Canara Bank | 8.65% – 11.25% | 8.65% – 11.25% | 8.55% – 11.15% |
| Indian Overseas Bank | 8.85% onwards | 8.85% onwards | 8.85% onwards |
Note: Interest rates as of 22 September 2023
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Home Loan Interest Rates of Top Private Sector Banks
| Name of Lender | Up to Rs. 30 Lakh | Above Rs. 30 Lakh & Up to Rs. 75 Lakh | Above Rs. 75 Lakh |
| HDFC Bank Ltd. | 8.50% – 10.20% | 8.50% – 10.20% | 8.50% – 10.20% |
| Kotak Mahindra Bank | 8.75% onwards | 8.75% onwards | 8.75% onwards |
| ICICI Bank | 9.00% – 9.80% | 9.00% – 9.95% | 9.00% – 10.05% |
| Axis Bank | 9.00% – 13.30% | 9.00% – 13.30% | 9.00%- 9.40% |
| Karur Vysya Bank | 9.23% – 10.73% | 9.23% – 10.73% | 9.23% – 10.73% |
| South Indian Bank | 9.57% – 10.97% | 9.57% – 10.77% | 9.57% – 11.42% |
| Karnataka Bank | 8.75% – 10.43% | 8.75% – 10.43% | 8.75% – 10.43% |
| Federal Bank | 8.80% onwards | 8.80% onwards | 8.80% onwards |
| Dhanlaxmi Bank | 9.35% – 10.50% | 9.35% – 10.50% | 9.35% – 10.50% |
| Tamilnad Mercantile Bank | 9.45% – 9.95% | 9.45% – 9.95% | 9.45% – 9.95% |
| Bandhan Bank | 9.15% – 15.00% | 9.15% – 13.32% | 9.15% – 13.32% |
| RBL Bank | 9.15% – 11.55% | 9.10% – 11.30% | 9.10% – 11.30% |
Note: Interest rates as of 22 September 2023
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Home Loan Interest Rates of Top Housing Finance Companies (HFCs)
| Name of Lender | Up to Rs. 30 Lakh | Above Rs. 30 Lakh & Up to Rs. 75 Lakh | Above Rs. 75 Lakh |
| LIC Housing Finance | 8.50% – 10.35% | 8.50% – 10.55% | 8.50% – 10.75% |
| Tata Capital | 8.70% onwards | 8.70% onwards | 8.70% onwards |
| 8.45% onwards | 8.45% onwards | 8.45% onwards | |
| PNB Housing Finance | 8.50% – 14.50% | 8.50% – 11.45% | 8.50% – 11.45% |
| Repco Home Finance | 9.50% onwards | 9.50% onwards | 9.50% onwards |
| GIC Housing Finance | 8.80% onwards | 8.80% onwards | 8.80% onwards |
| Indiabulls Housing Finance | 8.75% onwards | 8.75% onwards | 8.75% onwards |
| Aditya Birla Capital | 8.80% – 14.75% | 8.80% – 14.75% | 8.80% – 14.75% |
| ICICI Home Finance | 9.20% onwards | 9.20% onwards | 9.20% onwards |
| Godrej Housing Finance | 8.64% onwards | 8.64% onwards | 8.64% onwards |
| L&T Finance Limited | 8.60% onwards | 8.60% onwards | 8.60% onwards |
Note: Interest rates as of 22 September 2023
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Home Loan Interest Rates of Leading Foreign Banks
| Name of Lender | Up to Rs. 30 Lakh | Above Rs. 30 Lakh & Up to Rs. 75 Lakh | Above Rs. 75 Lakh |
| HSBC | 8.60% onwards | 8.60% onwards | 8.60% onwards |
| Standard Chartered | 8.75% onwards | 8.75% onwards | 8.75% onwards |
Note: Interest rates as of 22 September 2023
Home Loan EMI Calculator
Monthly EMI ₹ 15,622
Total Amount Payble ₹ 5,62,395(Principal + interest)
Principal Amount ₹ 5,00,000
Total Interest Payble ₹ 62,395
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Types of Home Loan Interest Rates
Depending on the interest rate, a home loan is of three types, fixed-rate, floating rate and hybrid.
1. Fixed Rate Loans – Fixed interest rate remains the same throughout the loan period, thereby, keeping the home loan EMI constant. Applying for a home loan at a fixed rate of interest is better when the current home loan rate of interest is quite low and an upward trend is anticipated in the future.
2. Floating Rate Loans – Floating interest rate, also known as the variable rate of interest, is subject to the current market lending rates; and thus, they may change during the loan tenure. The home loan EMIs will increase or decrease as per the interest rate movement.
3. Hybrid Loans – Hybrid rate home loans are a mix of fixed-rate and floating rate home loans. They will initially have a fixed interest rate for a set period, after which it will change into the floating rate of interest. Such housing loans are best suited for those who got the loan at a low fixed rate and plan to prepay or foreclose it before the floating rate starts.
Factors Determining Your Home Loan Interest Rate
As home loans are usually high-ticket size loans, banks and HFCs do a careful and detailed assessment of the borrower’s credit history, repayment capacity, income along with stringent checks on the property to be purchased. For borrowers seeking a home loan, they must be aware of the factors lenders look at while processing a home loan application, and have a deep awareness of their own eligibility. It needs to be noted that low-interest rates also usually come with stricter eligibility conditions. Here are the factors that lenders consider to determine your home loan eligibility and the interest rate to be offered:
- Credit score: Your credit score is a numerical representation of your credit history. Those who have paid their EMIs and credit card bills in full, timely, and have not been over-dependent on credit in the past are likely to have a good credit score. If your credit score from CIBIL and other bureaus is 750 and above, lenders would see you favorably for a home loan. Also, banks and HFCs are increasingly using the credit score of the home loan applicants to fix their home loan interest rates. As a high credit score reflects responsible credit behaviour and financial discipline, many banks and HFCs offer home loans to applicants with higher credit scores at a lower interest rate. Those having no or low credit scores can improve their credit scores by availing lifetime free Step UP Credit Card, a secured credit card co-branded with SBM Bank India Ltd.
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- Income and employment: When evaluating your home loan eligibility, lenders also factor in your income, type of employment and the profile of your employer. Home loan applicants employed with government or PSUs or those working with large and/or reputed private sector organizations are usually preferred by lenders due to their higher job/income certainty. Hence, lenders offer lower home interest rates to such applicants. On the other hand, home loan applicants with irregular or insufficient income might find hard to get home loan at a lower interest rate.
- Loan amount: The loan amount you seek to borrow can also influence the rate at which you get the housing loan. Home loans up to Rs. 30 lakh usually have a lower interest rate as compared to home loans of higher amounts. To get a lower rate of interest on your home loan, one should try and make the maximum down-payment possible. This will not just reduce the overall loan burden but may also help get a lower rate of interest on their loan.
- Type of home loan: Home loan rate of interest also differs as per the types of home loan. Regular home loans have standard rates while their counterparts such as Plot Loan or NRI Home Loan usually have higher rate of interest.
- Interest rate concession for women home loan borrowers: Some lenders provide home loan interest rate concession, usually of 0.05%, to women borrowers. Hence, it is advised that married couples should consider taking a joint home loan and make the wife the primary applicant if they can get a lower rate of interest. Availing joint home loan will also increase your home loan eligibility as well as home loan tax benefits.
- Type of interest rate: The type of interest rate you choose for your home loan will determine the rate at which you will repay your lender. In the case of fixed-rate home loans, EMIs remain the same for the entire loan period. Floating rates, on the other hand, change as per change in its lending rate such as Repo Linked Lending Rate (RLLR). Lenders usually charge higher interest rates on home loans offered on fixed interest rates due to the higher interest rate risk involved with fixed-rate home loans.
Also Check:- How much home loan can I get based on my salary?
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FAQs
Q1. What is Pre-EMI interest?
Ans. At times a home loan is disbursed in tranches, depending on the stages of completion of a housing project. Till the final disbursal of the loan amount, borrowers may be required to service the interest cost incurred on the disbursed loan amount. This interest is known as Pre-EMI interest. Pre-EMI interest is payable every month from the date of initial disbursement until the date of commencement of EMI.
Q2. Is there a way to check the total interest cost payable on the home loans?
Ans. Home loan applicants can use home loan EMI calculators for calculating the total interest cost payable on their home loans. They simply need to enter their home loan amount, tenure and interest rates into these calculators for calculating the EMI and the total interest cost of the home loan.
Q3. Can I switch my fixed rate of interest to floating rate during the loan period? Are there any charges involved?
Ans. Yes, you can switch from fixed rate to floating rate of interest. However, lenders usually charge 0.5% of the outstanding principal as a conversion fee.
Q4. What is External Benchmarking based Lending Rate?
Ans. External benchmark-based lending rate (EBLR) is the reference rate used for setting the interest rates for loans based on external benchmarks like RBI’s repo rate, T-Bill yields, etc. Prior to the introduction of EBLR, banks set interest rates for their floating rate loans after considering internal factors like cost of their deposits, operating costs, cash reserve ratio, etc. As per the RBI’s guidelines, all retail and MSME loans offered by banks on floating rates has to be linked to EBLR. EBLR was introduced with the aim of quickening the transmission of policy or market interest rate changes to the borrowers.
Q5. Which other external benchmarks do banks use to set home loan interest rates?
Ans. Apart from the Reserve Bank of India’s policy repo rate, other external benchmarks that banks use to set home loan interest rates include:
- Government of India 3-Months Treasury Bill yield published by the Financial Benchmarks India Private Ltd (FBIL)
- Government of India 6-Months Treasury Bill yield published by the FBIL
- Any other benchmark market interest rate published by the FBIL
Q6. Which bank offers the lowest home loan rate of interest for salaried and self-employed?
Ans. For fresh home loan borrowers, Union Bank of India offers the lowest interest rates starting at 8.35% p.a., followed by SBI and Bank of Baroda, which offer home loans at 8.40% p.a. UCO Bank and Bajaj Housing Finance also offer housing loans at one of the lowest interest rates starting at 8.45% p.a.
Q7. How frequently would my EBLR-based home loan interest rates change during my home loan tenure?
Ans. The changes in the interest rates of your EBLR-based home loan would depend on the changes in the external benchmark rates used by your bank and the set frequency of their interest rate reset. RBI guidelines require banks to reset their EBLR-linked interest rates at least once in 3 months.
Q8. Can my credit score impact my home loan interest rate?
Ans. Banks add spread and credit risk premium to their EBLR while setting their home loan interest rates. Banks consider credit score, employers’ profile, occupation profile, income, etc. among other factors for setting the credit risk premium for their home loan applicants. As a high credit score indicates financial discipline and regular repayments and thereby reduces the credit risk for the lenders, many banks charge lower credit risk premium to borrowers having higher credit score. These results in lower home loan interest rates for borrowers having higher credit score.
Q9. Can the credit risk premium component of my home loan interest rate change during the loan tenure?
Ans. As per the RBI guidelines regarding the external benchmark based lending rate, banks have been allowed to change credit risk premium component if the borrower’s credit risk assessment undergoes a significant change during the loan tenure.
Q10. Can the other components of the spread used in my home loan interest rate change during the loan tenure?
Ans. As per the RBI guidelines, your bank can change the other components of the spread used for setting your home loan interest rate once in three years.
Q11. Can adding a co-applicant help me get a lower rate of interest?
Ans. Yes, adding an earning female member of your family as a co-applicant might help you get home loan at a lower interest rate. Lenders like SBI, HDFC, Union Bank of India, Bank of India, etc. offer interest concession of 0.05% to women applicants.
Q12. At what credit score can the applicants avail best home loan interest rates?
Ans. Lenders usually offer lower home loans interest rates to applicants having credit scores of 750 and above. Some lenders also offer home loans to applicants having a credit score of less than 750, but at higher interest rates. Thus, prospective home loan applicants should try to improve/maintain their credit scores to 750 & above to avail home loan at best possible interest rate based on their credit profile.
Q13. Which bank is best for home loan?
Ans. For most consumers, a lender offering the lowest home loan interest rate would be the best as it will help them save on the overall interest cost. However, besides considering interest rates, parameters such as the home loan tenure, loan amount, LTV ratio, processing fees and time taken for loan approval and disbursal must also be looked into while searching for the best bank for home loan. Instead of visiting the websites of respective home loan lenders, consumers can make their search easier by visiting online financial marketplaces like Paisabazaar.com to check and compare home loan rates and other loan features such as tenure, processing fees and other related costs from various banks and HFCs.
Q14. How can I reduce my home loan interest burden?
Ans. Existing home loan borrowers can reduce their interest burden by transferring their outstanding loan amount to a new lender offering them lower interest rate and/or better terms. Reduced interest rate will reduce their EMIs and the overall interest cost.
Balance transfer customers can also choose to reduce their loan tenures during the loan application process. One can additionally choose shorter tenure during the balance transfer for further reducing their overall interest cost. However, it will also increase your loan EMIs. Hence, choose shorter tenures only when you are comfortable paying your revised home loan EMI.
Another way to reduce your interest burden could be by making part prepayments on your home loan whenever it’s feasible. Those prepaying their home loans usually have two options – tenure or EMI reduction. Those opting for EMI reduction would continue with the same residual tenure. Similarly, those opting for the tenure reduction option would have reduced EMI. Home loan borrowers seeking to further reduce their interest burden should go for tenure reduction option as it results in interest cost savings.