Who does not want to own a house property? It is on cards for many who think they can manage it by getting a loan and subsequently pay it back within the period they chose. Depending upon the rate of interest and other terms, a bank or financial institution is shortlisted. This year many banks are offering lower rates and there could be a boom in house property market due to this factor.
Kotak Mahindra Bank is on the top of the charts as it offers the pack of cheapest home loan with 6.75 percent for a Rs 75-lakh loan with a tenure of 20 years. State Bank of India offers its lowest interest rate of 6.8 percent to certain eligible borrowers. Punjab National Bank (PNB) being another public sector bank. India’s largest mortgage lender HDFC, charge a similar rate for home loans of Rs 75 lakh.
If we have a close look at the scenario, it can be said precisely that almost 17 banks and housing finance companies charge interest rates as low as between 6.75-6.9 percent a year Private sector also offers matching rates, home loans being the area where they can compete. On the other hand, in some cases better interest rates are charged by public sector banks.
There is a list of financial institutions which offer below 7% interest rates on home loans. It is evident that now is the time not to miss the opportunity and take the benefit if you are planning to go for a house property.
Home Loans: The Lowest Rates to offer
| Bank | Interest Rate * (PA) | EMI (Rs) |
|---|---|---|
| Kotak Mahindra Bank | 6.75% | 57,027 |
| Punjab National Bank | 6.80% | 57,250 |
| State Bank of India | 6.80% | 57,250 |
| HDFC Ltd | 6.80% | 57,250 |
| Bank of India | 6.85% | 57,474 |
| Central Bank of India | 6.85% | 57,474 |
| Bank of Baroda | 6.85% | 57,474 |
| Canara Bank | 6.90% | 57,698 |
| Punjab and Sind Bank | 6.90% | 57,698 |
| Union Bank of India | 6.90% | 57,698 |
| Axis bank | 6.90% | 57,698 |
| UCO Bank | 6.90% | 57,698 |
| IDBI Bank | 6.90% | 57,698 |
| ICICI Bank | 6.90% | 57,698 |
| LIC Housing Fin | 6.90% | 57,698 |
| Bajaj Finserv | 6.90% | 57,698 |
| Tata Capital | 6.90% | 57,698 |
*For a Rs.75-lakh home loan with 20 years tenure, the lowest interest rate is applicable only to eligible borrowers, data on February 11,2021.
Source: BankBazaar.com
Please note that-
- For the purposes of compiling data, interest rates on home loans for all listed (BSE) public and private banks and housing finance companies are as listed in National Housing Bank’s website, which offer home loans of Rs 75 lakh.
- Banks/HFCs for which data is not available on their websites are not considered. Taking the interest as the base, banks and HFCs in their respective sections are listed in the ascending order.
- Bank/HFC which offers the lowest interest rate is shown on the top followed by those that offer a slightly higher rate. The banks or HFCs with higher rates are shown at the bottom. Lowest rate offered by the bank/HFC on loan of Rs 75 lakh is considered in the table.
- EMI is calculated based on interest rates mentioned in the table for Rs 75-lakh loan with tenure of 20 years and for this processing and other charges are assumed to be zero.
Home loans with lower interest rates will reduce the EMI and also the interest payout. The total value of home loan also includes the processing fees, CRESAI charges and prepayment charges. All the factors should be taken into consideration before finalising the decision. But interest undoubtedly plays a vital role when a person taken a home loan.
Bhoi Smrutirekha Dharanidhar