LIC Housing Finance Interest Rate

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Updated: 06-01-2020 09:34:14 AM

LIC Home Loan Interest Rate is 8.10% p.a. Onwards. LIC Housing Finance is a well-known financial body, helping millions of subjects who seek housing finance for their home needs. The financial body has three major streams to provide housing finance to the public. They are Residential, Non-Residential and Pensioners.

LIC Home Loan Interest Rate 2020

DetailsEmployedSelf-EmployedPensioner
Interest Rate8.10-9.05%8.95-9.15%8.95-9.05%
Age18-60Years18-60 Years50+
Tenure30 Years25 Years15 Years or 70 Years Old
Loan Amount10 Lakhs-5Crs10 Lakhs-5CrsNegotiable
Experience2 Years3 Years      –
LTV Ratio75-85%75-85%75-85%
Processing Fee0.50%0.50%0.50%
TaxesGST+2.50%GST+2.50%     –

Check: LIC Home Loans for NRIs

Home Loan Interest Rate Types
Factors that affect Home Loan Interest Rates
Home Loan Interest Rate FAQs
Check Top Bank's Home Loan Rates

Home Loan Interest Rate Types

LIC Housing Finance home loan follows Floating interest rates. The NBFC offers its Home Loan packages under the MCLR method alone. Floating rate of interest is related to the Base Rate and MCLR. The MCLR, in turn, is calculated by taking into factors of –

  1.  Banks marginal cost of funding
  2. Negative carry on CRR
  3. Operating Costs
  4. Tenor Premium

Factors that affect Home Loan Interest Rates

There are a few factors that affect the Home Loan Interest Rates as below:

  • MCLR
  • Repo Rate
  • Reverse Repo Rate
  • Cash Reserve Ratio
  • Statutory Liquidity Ratio
  • Benchmark Prime Lending Rate

All these rates are results of Monetary Policy of RBI, which regulates financial liquidity in the country. At a personal level, some factors affect the interest rates as given below:-

1) Your credit scores and past repayment history would determine your interest rates. Maintaining a healthy credit history would arm you with better bargaining over the interest.

2) Location of your project is another determinant. An urban neighbourhood with facilities would fetch you better interest rates than remote ones.

3) Construction new structures would add more value than opting for another kind of alterations.

4) Accepting loan offer from a lender who opts for MCLR would make your loan cheap by 0.5%, in this case, the NBFC has changed the MCLR base rate this May.

Home Loan Interest Rate FAQs

What is the repayment period of LIC Housing Home Loan?

Any Home loans shall be tenured for a minimum of five years to 30 years maximum.

How to find a lower interest rate?

Interest rates are determined by existing Monetary Policy and bank lending rates. The difference will be a few percentage points taking into account all the parameters of a commercial bank. Above all, your willingness and capacity to repay determine the EMI.

Is switching of Interest rate possible?

Yes. You can switch from a fixed interest rate to floating interest rate and vice versa. Before that, you have to calculate the number of EMI’s that is to paid and other costs involved in doing so.

What is a Home Loan EMI Calculator?

Home Loan EMI Calculator is a formula used to determine the Equated Monthly Instalment of loan taken for acquiring a home. The formula is:

EMI = [P x R x (1+R) ^N/ [(1+R) ^N-1]

Where R = Principal or loan amount, R= Rate of interest, N= number of monthly installment. Interest rate is decided by the annual interest rate with 12 months. If the interest rate is 12, then the rate of interest will be calculated 12/ (12/100).

What is Home loan EMI?

Equated Monthly Instalment is the EMI which is the monthly repayment amount along with interest towards your Home Loan. It is determined when you are opting for a loan after deciding the period for returning the loan.

How does EMI calculation help?

Planning your finance: once you know your EMI after formally calculating you can arrive at the exact EMI that helps you to organize your finance.

Getting the right loan amount: You can derive towards the right amount that you require and allocate the EMI for repayment.

Budgeting for a perfect Home Buying: getting your dream home according to your budget is a big task. By setting the right EMI, you can relieve of your budgeting worries. In result, better concentrate on other financial requirements.

How to use Paisabazaar’s home loan calculator?

The Home Loan Calculator is used to compute the EMI for your Home Loan. You have to enter details about your home loan expectation in the calculator to derive a right EMI that suits to acquire your dream home. The loan amount is the amount you need to buy a home, the interest rate is the amount levied against the loan amount, and the tenure is the period of repayment. Once you decide about these factors, you can derive your EMI.

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