Loan against Property Interest Rates
| Lender | Interest Rates (p.a.) |
| Axis Bank | 9.90% – 10.35% |
| Bajaj Housing Finance | 8.50% – 18.00% |
| Bank of Baroda | 10.85% – 16.50% |
| Bank of India | 11.35% onwards |
| Bank of Maharashtra | 10.20% – 11.70% |
| Central Bank of India | 12.15% – 14.25% |
| Federal Bank | 12.60% onwards |
| Fullerton India | Based on customer’s profile |
| HDFC Ltd. | 9.35% – 12.25% |
| ICICI Bank | 10.85% – 12.50% |
| IDFC First Bank | 8.75% – 16.25% |
| Indian Bank | 10.00% – 12.60% |
| India Shelter Finance Corporation Ltd. | 15.00% – 24.50% |
| Karur Vysya Bank | 11.13% – 14.03% |
| Kotak Mahindra Bank | 9.15% onwards |
| LIC Housing Finance | 9.45% – 12.60% |
| L&T Housing Finance | 9.60% onwards |
| PNB Housing Finance | 8.99% – 13.00% |
| Punjab National Bank | 10.40% – 12.75% |
| State Bank of India | 10.60% – 11.30% |
| Tata Capital Housing Finance | 9.85% onwards |
| UCO Bank | 10.95% – 12.10% |
| Union Bank of India | 10.50% – 13.15% |
Note: Interest Rates as of 24 March 2023
Also Check: Which are the top banks and NBFCs for loan against property?
Loan Against Property EMI Calculator
Monthly EMI ₹ 15,622
Total Amount Payble ₹ 5,62,395(Principal + interest)
Principal Amount ₹ 5,00,000
Total Interest Payble ₹ 62,395
Tips to Avail Mortgage Loan at Low Interest Rates
These are some of the tips that can help you get loan against property at lower interest rates:
- Build and maintain credit score of 750 or above
- Enquire first with those lenders with whom you have deposit and/or loan accounts
- Keep a track of interest rate concessions during festive seasons
- Visit online financial marketplaces to compare loan against property offers from different lenders
Factors affecting loan against property interest rates
- Credit score: A high credit score reflects responsible credit behaviour and financial discipline; therefore, many lenders offer mortgage loans to applicants with higher credit scores at lower interest rates. Individuals lacking or having low credit scores can build/improve it by availing lifetime free Step UP Credit Card, co-branded with SBM Bank India Ltd.
Note: As lenders have an option to sell the underlying collateral if LAP is defaulted on, they tend to be more lenient with credit scores and other metrics when reviewing LAP applications. As a result, those who have been rejected a personal loan or are being charged higher interest rate due to their low credit score can consider availing LAP.
Read Also: Personal Loan Vs Loan Against Property – Which is Better?
- Loan amount: Many banks and HFCs fix mortgage loan interest rates on the basis of loan slabs. Loan against property amounting to Rs 30 lakh usually have a lower interest rate as compared to that of higher amounts.
- Type of property: Some lenders offer lower interest rate for self-occupied residential properties as compared to the rates charged for commercial properties or properties that are not self-occupied.
- Women applicants: Many lenders offer interest rate concession typically of 0.05% to women borrowers. Hence, roping in a female family member as a co-applicant can help in availing a lower interest rate.
- LTV Ratio: Loan to Value Ratio (LTV) refers to the proportion of the property value that you can avail as loan amount. The remaining value of the property has to be contributed by the homebuyer from his own sources. The maximum loan amount that lenders usually offer on a loan against property is up to 70% of the property’s value. Borrowing less helps reduce the loan-to-value ratio, increase loan eligibility and lower the interest rates. Note that LTV ratios also differ by the type of property.
- Income and employment: Lenders also factor in your income, type of employment and the profile of your employer while setting your interest rates. Lenders usually offer lower interest rates to salaried applicants due to their higher job/income certainty. Applicants who are self-employed with irregular income flows or unstable job profile or who have just started their professional journey are charged higher interest rates.
FAQs
How can I know the total interest cost payable on the loan against property?
Mortgage loan applicants can use loan against property EMI calculators for calculating the total interest cost payable on their mortgage loans. They simply need to enter their principal amount, tenure and interest rates into these calculators for calculating the EMI and the total interest cost of the loan.