Home Loan Interest Rates

The interest rates applied on home loans depend on several factors, such as the credit score of the applicant, loan amount, tenure, etc. It is suggested that the applicant go through the current home loan interest rates applied by different lenders before applying for a home loan. A slight difference in the interest rates can affect the overall interest rate of the borrower.

Here we have discussed the current home loan interest rates offered by all the banks in India and the methods to calculate them.

Home Loan Interest Rates of All Banks 2024

Here is the list of home loan interest rates 2024 for all the banks in India:

Private Sector Banks

Name of Lender

Current Home Loan Interest Rate

Axis Bank

8.75% – 12.70%

Karur Vysya Bank

9.23% – 12.13%

Karnataka Bank

9.26% – 10.53%

ICICI Bank

9.00% – 10.05%

Tamilnad Mercantile Bank

9.10% – 9.60%

Kotak Mahindra Bank

8.85% onwards

Bandhan Bank

9.15% – 15.00%

Federal Bank

10.15% – 10.30%

South Indian Bank

9.85% – 12.60%

RBL Bank

9.15% – 11.55%

Dhanlaxmi Bank

9.35% – 10.50%

Public Sector Banks

Name of Lender

Rate

Punjab & Sind Bank

8.85% – 9.95%

Punjab National Bank

8.65% – 9.50%

State Bank of India

9.15% – 10.15%

Indian Overseas Bank

9.55% – 10.95%

Bank of India

9.25% – 10.75%

UCO Bank

8.45% – 10.30%

Bank of Maharashtra

8.40% – 10.65%

Canara Bank

8.85%- 11.25%

Bank of Baroda

9.15% – 10.65%

Indian Bank

8.45% – 10.40%

Union Bank of India

9.00% – 10.75%

Foreign Banks

Name of Lender

Housing Loan Interest Rate

Citibank

8.45% onwards

Standard Chartered

8.75% onwards

HSBC

8.60% onwards

HFCs

Name of Lender

Home Loan Interest Rate in India

HDFC Ltd.

8.50% – 10.70%

Tata Capital Housing Finance

8.95% onwards

LIC Housing Finance

8.90% – 10.75%

Bajaj Housing Finance

8.70% onwards

PNB Housing Finance

8.50% – 14.50%

Repco Home Finance

9.60% onwards

Indiabulls Housing Finance

8.75% onwards

L&T Housing Finance

8.60% onwards

GIC Housing Finance

8.45% onwards

ICICI Home Finance

9.20% onwards

Aditya Birla Capital

8.80% – 14.75%

Godrej Housing Finance

8.64% onwards

Types of Home Loans Interest Rates

There are three types of home loan interest rates: fixed, floating, and hybrid.

  • Fixed Rate Interest Rate - A fixed interest rate remains consistent throughout the loan tenure, resulting in a steady home loan EMI. When the present home loan rate of interest is fairly low, and an upward trend is expected, applying for a fixed interest rate is preferable.
  • Floating Interest Rate - A variable or floating interest rate is subject to current market lending rates and may fluctuate during the loan term. The EMIs on house loans will increase or fall in response to changes in interest rates.
  • Hybrid Interest Rate - Hybrid home loan interest rates are a combination of fixed and floating interest rates. They will have a fixed interest rate for a defined period before switching to a fluctuating interest rate. Such interest rates are best suited for customers who want to obtain a home loan at a low fixed rate and intend to prepay or foreclose before the floating rate begins.

How to Apply for a Home Loan?

Here is the step-by-step process for a home loan application:

Step 1: Fill out the Home Loan Application Form

The process of obtaining a home loan begins by filling out the home loan application form. One must fill in the following details while submitting the application form:

  • The applicant's personal information (Name, Phone number, etc.)
  • Residential or current address.
  • Monthly income of the applicant.
  • Educational background.
  • Current and previous employment details.
  • The details of the property for which the housing loan will be applied.
  • The estimated cost of the property.
  • The current method of financing the home.

Step 2: Verification and Processing 

The bank begins processing your Home Loan application after you submit the form and the essential documents. The bank also investigates your credit score thoroughly. As a result, it is important that you keep a positive credit history. You must submit accurate information during the application process. Any false information will lead to your loan application getting rejected.

Step 3: Loan Sanction

All the documents that are submitted during the application process will be verified by the bank to process the application further. It normally takes 1-2 days, or even less, if the paperwork is found correct after the verification process.

In certain situations, the bank can also request the applicant to come for an in-person verification before the loan is approved. This is done to gather more information about the application and to ensure that he or she will be able to repay the loan plus interest.

Step 4: Technical and Legal Check

The bank undertakes legal and technical inspections before disbursing the loan money. The property for which you have requested a loan will be verified by the bank representatives. If the property is under construction, they will inspect the construction progress and work quality.

The bank representatives will analyze the actual value of the property during the technical check. The property's status (under construction or for sale) will also be considered.

If the property is a resale, the bank will look at the age and upkeep of the property. In case of a resale, the bank may additionally investigate if the property has previously been mortgaged. They will also investigate the ownership rights of the property to see if there is any conflicting information in the documents and proofs provided.

Step 5: Payment of Home Loan Processing Fee

After successfully verifying the paperwork and legal check, the applicant will have to pay the home loan processing fee to the bank. This processing fee is collected to maintain the loan account of the applicant. 

Usually, the processing fee for a home loan ranges from 0.25 % to 0.50 % of the loan amount.

For example, suppose you have applied for a home loan of Rs. 15 lahks, then you will have to pay a processing fee of Rs. 3,750 (at 0.25%) and Rs. 7,500 (at 0.50%), respectively.

Step 6: Disbursal of Loan Amount

This is the final step of the home loan application process. After you have met all the eligibility criteria, a formal agreement letter will be sent to you. Following that, your loan will be disbursed to your bank account. You will receive a complete home loan EMI schedule at your registered email address.

Methods to Calculate Home Loan Interest Rate

There are two major methods for the calculation of the housing loan interest rate, and they are:

a) Home Loan Interest Rate Formula for All Bank Calculations

This is a manual form of calculation, and the below-mentioned formula is used:

[P x r x (1+r)^n]/[(1+r)^n-1]

Here, p = Principal, R = Rate, and n = term.

b) EMI Calculator for the Current Home Loan Interest Rate Calculations

This is an online EMI calculator that is used to calculate the interest rate, monthly EMI, and total payable amount. You can find an EMI calculator option on your Bank's online website. You will have to enter these details to calculate your monthly EMI:

  • Rate of Housing Loan Interest Rate
  • Total Loan Amount
  • Total Tenure for Loan Repayment

Factors Affecting the Housing Loan Interest Rates

The following are the factors that determine your home loan eligibility and the final housing loan interest rates that will be offered:

  • Employment and Income: Lenders consider your salary, type of employment, and employer profile when determining your home loan eligibility. Therefore, you must provide appropriate employment details for successful verification.
  • Interest Rate Type: The interest rate you choose for your home loan will impact how quickly you can repay your lender. In fixed-rate house loans, EMIs remain constant throughout the loan term. On the other hand, floating rates fluctuate in response to changes in the lending rate, such as the Repo Linked Lending Rate (RLLR). Lenders will usually charge higher interest rates on fixed-rate house loans due to the higher interest rate risk inherent with fixed-rate home loans.
  • Loan Amount: The amount of money you want to borrow might also affect the interest rate on your home loan. House loans up to Rs. 30 lakhs often have cheaper interest rates than larger home loans. 
  • Credit Score: The credit or CIBIL score is a number that represents your credit history. Paying your EMIs on time will help you maintain a positive credit score. If your credit score is 750 or higher, the chances of getting a housing loan can be high. Many banks and HFCs offer lower-interest home loans to candidates with higher credit scores.

You must check all the eligibility conditions before applying for a housing loan. You should go through the current home loan interest rates of all the banks and decide accordingly. You can also visit any bank branch in your city and seek professional assistance to get the options and offers available.

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