Owning your own house is a dream that most of us hope to achieve in our lifetime. However, realizing this dream becomes a little difficult, especially for the salaried and middle-class people for the kind of enormous rates banks charge against home loans. In addition, home loans also last anywhere between 2-30 years in most cases.
As a prospective home buyer, if you are to buy a house for yourself, you would naturally want to take a home loan from a bank that offers the lowest home loan interest rate. To help you achieve your dream at the best price possible, we have curated this exhaustive blog with a list of the home loan interest rates and EMIs offered by all the top 15 banks in India. We hope this helps you figure out the lowest home loan interest rate possible and takes you a step closer to your dream home!
Home Loan Interest Rates in India March 2022
Before we get to the comparison table of the home loan interest rates in India for March 2022, it should be noted that one needs to have the following in order to have their home loan processed by the bank-
- A sustainable income proof
- Favorable credit history and CIBIL score
List of Home Loan Interest Rates in India as Offered by all the Top Indian Banks & NBFCs as of March 2022
List of Banks/NBFCs | Home Loan Interest Rates | Processing Fees |
Allahabad Bank | 7.00% – 7.50% | Up to 0.40% of the loan amount to a max INR 50,000 |
Andhra Bank | 6.40% – 7.40% | 0.50 % of loan amount subject to maximum of INR 10,000 + GST |
Axis Bank | 6.75% – 7.20% | Up to 1% of the Loan amount subject to minimum of INR 10,000 Upfront processing fee of INR 2,500 + GST |
Bandhan Bank | 8.50% – 11.75% | 1% of Loan Amount , Min INR 5,000 + GST |
Bank of Baroda | 6.75% – 8.25% | Up to 0.50% of the loan amount or a maximum of INR 7,500 + GST |
Bank of India | 6.85% – 8.35% | 0.25% of the loan amount + GST |
Bank of Maharashtra | 7.05% – 8.40% | As applicable |
Canara Bank | 6.90% – 8.90% | 0.5% of the loan amount + GST |
Central Bank of India | 6.85% – 7.30% | 0.50% of the loan amount subject to maximum INR 20,000 + GST |
Citibank | 6.50% – 7.40% | Up to 0.40% of the loan amount + GST |
Corporation Bank | 6.40% – 7.40% | 0.50% of loan amount. Max INR 50,000 + GST |
Dena Bank | 6.75% – 8.25% | As applicable |
Federal Bank | 7.65% – 7.80% | 0.50% of the loan amount to a maximum of INR 7,500 + GST |
Fullerton India | 7.99% – 12.00% | 3% of the loan amount + GST |
HDFC Limited | 6.70% – 8.00% | Up to 0.50% of the loan amount or INR 3,000 whichever is higher, plus applicable taxes. |
HSBC | 6.45% – 6.80% | 1% of the loan amount + GST |
ICICI Bank | 6.70% – 7.55% | Up to 1.00% of the loan amount + GST |
IDBI Bank | 6.95% – 10.05% | 0.50% of loan amount to a maximum of INR 2,500 + GST |
IDFC First Bank | 7%-11.00% | Upto INR 10,000 + GST |
IndusInd Bank | 6.70% – 8.00% | INR 10,000 + GST |
Indiabulls Housing Finance | 8.65% Onwards | 0.50% of the loan amount to a maximum of INR 15,000 + GST |
Jammu & Kashmir Bank | 7.20% – 7.60% | 0.25% of the loan amount to a maximum of INR 10,000 + GST |
Karnataka Bank | 8.08% – 8.85% | 0.50% of the loan amount + GST |
Karur Vysya Bank | 7.25% – 9.55% | Up to INR 7,500 + GST |
Kotak Mahindra Bank | 6.55% – 7.10% | Zero processing fee for online application (Upto 1.25% of Loan amount for offline application) |
LIC Housing Finance (LIC HFL) | 6.66% – 7.90% |
|
Lakshmi Vilas Bank | 8.55% | As applicable |
Nainital Bank | 7.00% – 7.65% | As applicable |
Oriental Bank of Commerce | 6.75% – 7.80% | 0.50% of the loan amount to a maximum of INR 20,000/- + GST |
Punjab National Bank (PNB) | 6.75% – 7.80% | 0.35% of the loan amount, subject to a minimum and maximum of INR 2,500 and INR 15,000 respectively |
PNB Housing Finance (PNBHFL) | 6.75% – 9.25% | INR 10,000 + GST |
Punjab & Sind Bank | 7.30% – 7.65% | Up to 0.25% of the loan amount to a maximum of INR 15,000 + GST |
Reliance Home Finance | 8.75% – 14.00% | Up to 0.75% of the loan amount + GST |
RBL Bank | 9.50% – 12.30% | INR 5,000 – INR 15,000 of the loan amount + GST |
State Bank of India (SBI) | 6.70%-6.90% | 0.35 % of loan amount and maximum INR 10,000 +GST |
Standard Chartered Bank | Starting at 6.99%* | INR 10,000 + GST |
Syndicate Bank | 6.90% – 8.90% | 0.125% of loan amount or a maximum of INR 5,000 + GST |
Tata Capital | 6.90 – 8.75% | As applicable |
UCO Bank | 6.90% – 7.25% | 0.5% of the loan amount, to a maximum INR 15,000 + GST |
United Bank of India | 6.75% – 7.80% | As applicable |
Vijaya Bank | 6.75% – 8.25% | INR 4,000 + GST |
YES BANK | 6.70% – 11.80% | 0.5% of the loan amount or a maximum of INR 10,000 + GST |
How to Get a Home Loan with a Low-Interest Rate?
Banks consider a number of factors before offering a home loan. The following are some of the elements that influence the interest rate on a house loan:
Location of the property
People seeking properties on government-approved lands and areas have a higher chance of getting a loan sanctioned of as much as 75-90% of the property value.
Good credit score
You’ll need a CIBIL score of 650 or higher to be approved.
Apply at your current bank
A excellent working relationship with the bank allows you to get a large loan amount with a low-interest rate on your house loan without any worry.
High Income
A individual with a strong income has a better chance of receiving a lower rate and a larger sum.
Property-related paperwork
It is critical to maintain and keep all property-related documents on hand because they assist the bank in properly identifying your property and its value, allowing them to verify your profile.
Income proof
Applicants with valid income statements are more likely to get a home loan at a low rate from a bank. in case you do not have valid income proof, the only way for you to get a loan is by applying to NBFCs (a nonbanking financial company), and NBFCs attract a very high-interest rate.
Apply when you're young
Loan applications of applicants between 20-30 are given a higher priority and with low-interest rates as people of this age group have lesser financial liabilities.
How To Calculate Home Loan EMI?
In order to calculate your home loan EMI, you will need the following figures handy:
- Housing loan interest rate
- Total loan amount
- The loan tenure
Apply the above numbers in the following formula to calculate your home loan EMI:
EMI = [P x R x (1+R)^N]/[(1+R)^N-1]
- EMI = Equated Monthly Installment
- P = Principal Loan Amount
- R = Monthly Interest Rate
- N = Number of Monthly Installments
Is Interest Rate Conversion Allowed on Fixed Rate Home Loans in India?
Home loans in India are typically offered on Fixed Interest Loans as well as Floating Interest Loans. While the fixed interest loans are offered at a ‘fixed’ interest for the entire tenure period, floating interest loans are offered at ‘changing’ interest rates through the period. The changing interest rates in the case of floating interest home loans are subjected to the changes that take place in the market.
Though the interest rate changes in the case of floating rate home loans, such loans offer lesser interest obligations as compared to fixed-rate home loans. Hence, if you take a home loan at a fixed rate, it can still be converted to a floating rate and you can then save on the total interest paid. It should be noted, however, that you will need to pay a ‘conversion’ fee to the bank for changing your home loan from a fixed rate to a floating rate. The said fee varies from bank to bank.
Is Interest Rate Conversion Allowed on a Floating Rate Home Loan in India?
Yes, floating rate home loans in India can be converted to the most cost-efficient floating interest rate benchmark for higher savings on the total home loan interest paid.
At current, there are three such benchmarks-
- Base rate
- Marginal cost of lending rate (MCLR)
- Repo-linked lending rate (RLLR)
Of these three, the repo-linked lending rate (RLLR) is the most transparent rate. RLLR-based home loans are, in fact, typically offered at a 0.30%-0.40% lesser rate than the marginal cost of lending rate. But again, it should be noted that if you wish to convert your floating interest rate home loan to an MCLR or RLLR-based home loan, a conversion fee will still be applicable. The said fee varies from bank to bank.
Final Thoughts: What to Do if the RLLR-Based Home Loan Rate is Higher than the Prevailing Market Rate?
If your repo-linked lending rate or RLLR-based home loan is at a higher interest rate than the average market rate, it is recommended to do a balance transfer to another lender at a lower rate. One of the immediate benefits you can then avail of is in the form of a lower EMI. This will also further help reduce your total owed interest as the new rate will be at least 0.25%-0.50% lower than the existing rate.
It should also be noted that the said balance transfer will attract a ‘switchover fee,’ which will either be a flat, upfront amount or a percentage of the transferred balance. Alternatively, some banks may also offer a waiver on the balance transfer fee.
