Best Home Loan in India 2024

Factors to Consider While Applying for a Home Loan

The following are the key factors to take into account when applying for a Home Loan-

• Total EMI Amount

You will pay monthly instalments for your borrowing until the end of the loan period. Each EMI consists of both principal and interest. Therefore, your principal repayment will increase with each EMI, and your interest payments will decrease over time.

• Duration

Check the length of time you will take to repay the loan. You can choose a period that works for you based on the nature of your expected income.

• Rate of Interest

The bank or financial institution charges interest in exchange for money lending services. The principal amount determines the interest rate, and you will repay the loan.

• Initial Payment or Down Payment

A down payment is a sum you contribute on your own. You should put down as much money as possible to lower the loan without straining your finances. You will pay less interest the smaller the loan amount.

Many banks will lend you 100% of the property's value, subject to qualification. Nevertheless, it would be best to put down 10% to 20% at the very least to avoid paying excessive interest and guarantee a manageable repayment schedule.

• Mortgage Insurance

Home loan insurance, also known as loan cover term assurance, is a type of insurance policy that offers your family financial security in the event of your untimely passing.

If something unfavourable happens, the insurance provider will pay back the loan balance on which the insurance was purchased. This ensures that the unpaid dues' monetary hardship will not fall on your family. Moreover, to prevent defaults in the event of an unfortunate event, numerous banks and housing finance firms insist that customers purchase a loan cover word guarantee plan.

• Additional Fees

Other administrative, processing or service fees that banks impose on borrowers at the time of the loan application may exist in addition to the EMIs. Make sure you review these with the lender before applying for a loan.

Check to see if they are monthly fees or one-time charges; if they are the latter, your monthly budget needs to be adjusted to account for them alongside your EMIs.

Best Bank for Home Loan in India: Overview

Let's explore which bank is best for home loan here-

1) SBI Home Loan

SBI Home Loan is considered the best bank for Home Loan in India. Home loans from the State Bank of India have some of the most attractive and best home loan interest rates in India, starting at 8.50% p.a.

A loan tenure extension option of up to 30 years guarantees a comfortable repayment period. The processing fee for these loans is 0.35 per cent of the loan amount (minimum Rs. 2,000; maximum Rs. 10,000) plus applicable taxes.

On SBI Home Loans, female borrowers are also eligible for an interest reduction of 0.05%. They are one of the nation's most popular housing loan products because there are no additional fees, and prepayment penalties are entirely waived.

2) HDFC Home Loan

To those who qualify, HDFC Home Loans offers affordable home loans with interest rates starting at 8.75% per year. This is another best Home Loan providers in India.

For loans with terms of up to 30 years, the EMI begins at Rs. 762 per lakh. For employed individuals, the processing fee for these housing loans will not exceed Rs. 3,000 (plus applicable taxes); unemployed individuals will not exceed Rs (plus applicable taxes).

3) Axis Bank Home Loan

Axis Bank Home Loan is one of the best bank for Home Loan, with interest rates beginning at 8.65% p.a. On fixed-rate loans, Axis Bank provides eligible customers with housing loan options.

For floating-rate loans, the tenure may be increased to 30 years, while for fixed-rate loans, it may be increased to 20 years. In addition, up to 1% of the loan amount (minimum of Rs. 10,000) may be charged as the processing fee, of which Rs. 2,500 plus GST must be paid in advance at the time of loan application login.

4) ICICI Home Loan

Housing loans are available from ICICI Bank to qualified borrowers at competitive interest rates starting at 8.75% p.a., with loan terms of 30 years and simple repayment options. In addition, they lack processing fees on floating-rate loans, which range from 0% to 0.50% of the loan amount (plus applicable taxes).

Additionally, ICICI collaborates with the PMAY Scheme, giving homebuyers an advantage when purchasing. It is considered one of the best bank for Housing Loan.

5) Bank of Baroda Home Loan

Home loans from the Bank of Baroda have some of the best home loan rates in India, starting at 8.40% p.a. and going up to 30 years with simple repayment options. In addition, the bank offers loans up to Rs. 10 crores and Bank of Baroda housing loans have processing costs as low as 0.25 per cent of the loan amount.

The bank levies no prepayment penalties for home loans with floating interest rates. One of its key benefits is the Bank of Baroda home loan's ability to be topped up to five times during the loan term.

6) PNB Home Loan

With a maximum loan amount of Rs. 1 crore, Punjab National Bank offers several home loan schemes at affordable rates beginning at 9.40% p.a.

The repayment period may be extended to 30 years at your discretion (maximum). A processing fee of 0.35 per cent of the loan amount plus GST is charged. EWS, LIG, and MIG applicants can take advantage of discounted rates through PNB's PMAY program.

7) LIC Housing Finance Home Loan

LIC Housing Finance Limited's affordable home loan options range from Rs. 1 lakh to Rs. 15 crores, with flexible 30-year terms and attractive interest rates starting at 8.50% p.a. Depending on the circumstances, the processing fee is up to 0.5% of the loan amount plus GST.

FIC HFL provides the best housing loan programs for NRIs and retirees at competitive interest rates.

8) Aditya Birla Home Loan

Home loans from Aditya Birla Housing Finance are available with processing costs as low as 1% of the loan amount and interest rates as low as 8.60% p.a.

For a loan repayment period of up to 30 years, loan amounts varying from 75% to 90% of the property's value are available. In addition, for home loans with floating rates, there are no prepayment penalties.

9) Citibank Home Loan

Citibank offers low-interest home loans starting at 8% p.a. for amounts up to Rs. 10 crores. For more manageable repayment, you can extend the term to 25 years. In addition, you can receive financing for 80% of the total cost of the property through Citibank's home financing programmes.

10) Bandhan Bank Home Loan

Bandhan Bank offers home loans at attractive interest rates ranging between 9.16% to 15.00% p.a. Its processing fees are 0.25% to 1.00% of the loan amount (based on the scheme) + GST. 

Conclusion

After learning about the best banks to choose from and the best lenders for home loans, consider that not every loan program is suitable for every borrower.

Before applying for a home loan in India, you must carefully consider the requirements since each individual or bank has different ones. As a result, you should choose a home loan based on your loan requirements, repayment ability, and cash flow.

Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.

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Research Analyst - Aakash Baid