Yogi Zone

Useful articles for your finance management by our team of experts

Best Interest Rates on Home Loans

15 Flares 15 Flares ×

Bankbazaar.com helps compare the best interest rates on home loans

best home loan ratesSo, are you planning to buy your Dream Home? Buying home is one of the most important achievements of your life and it involves a lot of careful planning. But proliferation of banks and NBFC’s has made life easier, as a wide variety of housing loans are provided by them. You just need to be ready with the documents which prove your home loan eligibility. Even though availability of options makes life easier, it also leads to confusion at times as you don’t know which option will suit you best. Through this article, we will try to explore the factors that you should keep in mind while choosing a financing partner. These factors are going to affect the interest that you are going to pay against the loan. We will also find out the best interest rates available for housing loans in current market scenario.

Points to ponder while comparing home loans from different financial institutions

As a loan seeker you need to focus on following parameters when comparing home loan rates from various institutions.

1. Purpose of loan – Are you purchasing a new house (Is it ready for possession or under construction)? Are you taking loan to construct a house on land you own? Interest rates vary as per the purpose of the loan and you should opt for minimum rates for different categories.

2. Loan Amount and Tenure – Total loan amount and tenure plays an important role while deciding the down payment, EMI and interest rates.

3. Processing fees – One must take into consideration the processing fee of the loan. This varies substantially from bank to bank. Although it doesn’t directly impact the interest rate, it’s still a cost.

4. Pre-payment and closure fees – Similar to processing fees. One must also pay attention to prepayment and pre closure fees as they are going to dent your pocket.

Home Loan Interest Rates for comparison

Interest rates data for home loans by various banks and NBFC’s are presented below. Amount of loan is assumed to be less than 20 lakh and tenure is from 10 to 15 years.

Bank NameFloating Interest ratePer lac EMIProcessing FeePrepayment Charges% Change in last 6 mths
State Bank Of India9.95%Rs. 962Up to 25 lacs : 0.125% of loan amount, minimum Rs.1000/-Nil1.97%
25-75 lacs : Rs.3,250/-
75 & above : 5,000/-
ICICI BankScheme I :10.15% (Fixed 1 yr)Scheme I :Rs.975 (Fixed 1 yr)0.50% of loan amount up to 1 croreN.AScheme I :0.98% (Fixed 1 yr)
Scheme II : 10.15% (Fixed 2yrs)Scheme II : Rs.975 (Fixed 2yrs)Scheme II : same (Fixed 2yrs)
Scheme III : 10.50% (Fixed 3yrs)Scheme III : Rs.998 (Fixed 3yrs)Scheme III : same (Fixed 3yrs)
then 10.15%then Rs.975then 0.98%
HDFC Ltd10.15%Rs. 9750.5% or maximum 10,000+service tax (12.36%)No prepayment charges shall be payable for partial or full prepayments irrespective of the sourceN.A
HSBC Bank10.50% – 10.75%Rs.998 – Rs.10151% of the loan amount applied for, subject to a minimum of Rs 10000 plus service tax. This fee is payable on application and is not refundableNilN.A
LIC HousingScheme I : 10.25% (Fixed for 2 yrs) Scheme I : Rs.982 (Fixed for 2 yrs) Up to 50 lacs : 10,000 +(Service tax)NilScheme I : 4.65%
Scheme II : 10%(Fixed for 3 yrs)Scheme II : Rs.965 (Fixed for 3 yrs)50 lacs & above : 15,000 +(service tax)Scheme II : 6.54%
Scheme III : 10.75%(Fixed for 10 yrs)Scheme III : Rs.1015 (Fixed for 10 yrs)Scheme III : 1.83%
AXIS Bank10.25%Rs. 9821% of the Loan AmountNilN.A
IDBI10.25%Rs. 982Up to .50%of loan amountIf Balance Transfer then 2% Otherwise NilNo Change
(Rs 2500 to be collected at login and balance at the time of sanction )
PNB Housing Finance10.25% – 11% (For Salaried/SEP), 10.75%-11.25% (SENP)(Upto 10Lacs) then, 10.50%-11.25% (For Salaried/SEP), 11%-11.50% (SENP)Rs.982 – Rs.1032 (For Salaried/SEP), Rs.1015 -Rs.1049 (SENP)(Upto 10Lacs) then, Rs.998 – Rs.1049 (For Salaried/SEP), Rs.1032 – Rs.1066 (SENP)0.50%NILNo Change
ING Vysya10.75%Rs. 1,0150.5% of the loan amountNILN.A
Standard Chartered9.99%Rs. 964Rs.7500/- + Service taxNILNo Change
Citibank9.75% – 10.25%Rs.948 – Rs.9820.25% or 5,000 + 12.36%( service tax)NILN.A
Deutsche Bank10.50%Rs. 99812000 + Service TaxNilN.A
DHFL10.50%(Upto 15 lacs), then 10.75%Rs.998 (Upto 15 lacs), then Rs.10151% for Salaried & 1.5% for SENPNIL2.33%
India Bulls10.15%Rs. 975Up to 30 lacs 5,000+12.36%(Service tax)NILN.A
30 lacs & above : 15,000+12.36%(Service tax)
Federal Bank10.48%Rs. 99710,000 + Service TaxN.A2.24%
Allahabad Bank10.20%Rs. 9780.50% of loan amount, Maximum Rs. 10,000/-NILN.A
Bank of Maharastra10.55%Rs. 1,0020.50% (Max. Rs. 50,000/-)Nil2.38%
Central Bank of India10.25%Rs. 9820.50% of the loan amount subject to maximum of Rs.20,000/-Nil2.38%
Corporation Bank10.25%Rs. 9820.50% of Loan amount (Max.Rs.50,000/-)NIL2.38%
Bank of India10.25%Rs. 9820.25% of loan amount. Min.Rs.1,000 and Max. Rs.20,000Nil2.38%
Union Bank of India10%Rs. 965Processing charges are 0.50% of the loan amount subject to maximum of Rs. 15,000NIL2.44%
United Bank of India10.75%Rs. 1,0150.50% of the loan amountN.AN.A
UCO Bank10.20%Rs. 9780.5% of the loan amount, minimum Rs.1500/- & maximum Rs. 15000/-NILN.A
Bank of Baroda10.25%Rs. 982Loan upto Rs.30 Lacs – 0.50% (Minimum Rs.5,000/-)N.A.N.A
Above 30 Lacs – 0.40% (Min. Rs.15,000/- & Max. Rs.50,000/-)
Canara Bank10.45%Rs. 9952.79%
Oriental Bank of Commerce10.25%Rs. 9820.50% of the loan amount, subject to maximum of Rs. 20000/- plus service taxNILNo Change
Kotak Bank10.75%Rs. 1,0150.25% – 0.5%2% on Balance transfer else NILN.A
Dena Bank10.30%Rs. 9850.50% of sanctioned limitN.A1.90%
Punjab National Bank10.25%Rs. 982N.A
First Blue Home Finance10.25% (for Salaried / SEP), 10.75% (For Self Employed)Rs.982 (for Salaried / SEP), Rs.1015 (For Self Employed)Salaried: Up to 30 lacs :7300NilN.A
30 – 75 lacs : 11800
75 lacs & above : 15,000 + service tax(12.36%)
Vijaya Bank10.50%Rs. 9980.25% of loan amount. Maximum Rs.10000. Exclusive of Service TaxN.AN.A
Syndicate Bank10.25%Rs. 982upto Rs.25 lacs - 0.25% (Min Rs 1000 – Max Rs 5000)N.ANo Change
26 lacs to 75 lacs - 0.55% (Max.Rs.500/-)
above Rs.75 lacs - 0.55% (Max Rs.10000/-)
Indian Overseas Bank10.25%Rs. 982A flat rate of 0.58% of the loan amount- maximum of Rs. 10,190/- There is no hidden charge. This is subject to change from time to time without prior intimation.N.AN.A
Reliance11.50% – 11.75%Rs.1066 – Rs.10840.75% of loan amountNILN.A
Development Credit Bank11.50%Rs. 1,0661%NilN.A
State Bank of Travancore10.25%-10.50%Rs.982 – Rs.998Processing fees stands reduced by50% of normal charges during the campaign periodNILN.A
Tata capital Housing Finance ltd10.75%Rs. 1,0150.5 to 1% off the loan amount.N.AN.A
Dhanalakshmi BankScheme I: 11.50% (Fixed for 1 yr), Then 12% Scheme I: Rs.1066 (Fixed for 1 yr), Then Rs.1101 1% + service taxN.AN.A
Scheme II: 12%Scheme II: Rs.1101
Indian Bank10.20%Rs. 978NilNilN.A

*Source: http://www.deal4loans.com

What are the other costs to consider?

Banks and NBFC’s levy different kinds of fee other than what we discussed above. These charges can have any name or structure. Before actually choosing your financer, you must be careful about the nature and amount of following costs:

Booking fee: This fee is payable to the lender while you apply for the loan. It could be fixed or variable in nature.

Miscellaneous Costs: Some Banks and NBFC’s ask for documentation or consultancy fee. They might call it application fee.

Registration and Stamp Duty charges - These are genuine charges and are paid to the Sub-Registrar’s Office. These are charges for transferring the rights of the property from the builder to the buyer. Be careful as you might be overcharged in the name of misc. fees.

Word of Caution

Please note that the home loan interest rates are quite volatile in nature. It depends on the current interest rate scenario and subject to change as per discretion of bank and NBFC’s. Users are advised to crosscheck current rates from individual company’s official website.


Home Loan EMI Calculator

Fixed Deposit Calculator

15 Flares Facebook 10 Google+ 3 Twitter 2 Email -- 15 Flares ×