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Best home loan in india

Home loans are a common requirement for most people in India. Buying a house is a dream for all of us but it is not possible for most people in India to pay such a huge amount to buy a house at one time.

That is why the concept of home loan is a trending topic in India.

Best home loan is a relative term because sometimes what is best for us is bad for others and what is bad for us is best for others.

So, I will talk about this subject in general terms.

In India, you can apply for a home loan in three

Ways to apply for Home loan

  1. Private Bank
  2. Public Sector Bank
  3. NBFC

Now the important things you have to keep in mind while applying for home loan are:

Interest Rate

Interest rate is the amount a lender uses for a property levied by a lender on top of a principal.

If the lender is ready to lend the loan for the property you want to buy

Mainly public sector banks lend the loan keeping in mind the following things :

Documentation –

This is an important component to reduce turnaround time. Since PSU lenders such as SBI are very heavy on documentation, they take a lot of time to disburse towards builders.

Fines and Fees –

The borrower will have to check all such details such as how much penalty will be incurred on prepayment or late monthly installment payment.

No prepayment and hidden fees –

You should carefully observe the terms and conditions and all the charges levied by the bank.

Now we will compare home loan interest rates for all leading banks in India: –


Home Loan Providers Home Loan Rates Processing Fees*
SBI 8.40% onwards 0.35% – 0.50% of the loan amount (Min. of Rs. 2,000;  Max. of Rs. 10,000)
HDFC Bank 8.55% onwards Up to 0.5% of loan amount
ICICI Bank 8.70% onwards 0.5% – 1.00% of loan amount (Min. of Rs. 1,500)
Axis Bank 8.90% onwards Up to 1% of loan amount (Min. Rs. 10,000)
LIC Housing Finance 8.40% onwards As applicable
Indiabulls Housing Finance 8.80% onwards Up to 1% of loan amount
PNB Housing Finance 9.25% onwards Up to 1% of loan amount
DHFL 9.75% onwards Min. Rs. 5,000
Bank of India 8.75% onwards Min. 1000 and Max. Rs. 20,000
Syndicate Bank 9.35% onwards Min. Rs. 500 to Max. Rs. 5,000
Canara Bank 8.60% onwards 0.50% of the loan amount (Min. Rs. 1,500; Max. Rs. 10,000)
IDFC First Bank Up to 10.15% Up to 3% of the loan amount
United Bank of India 8.55% onwards 0.59% of loan amount (Min. Rs.1,180; Max. Rs.11,800)
Tata Capital 9.25% onwards 0.5% of loan amount
YES Bank 9.85% onwards 2% of loan amount (Min. Rs.15,000)
Standard Chartered Bank 9.41% onwards Up to 1% of the loan amount
Punjab National Bank 8.50% onwards 0.35% of the loan amount (Min. Rs. 2,500; Max. Rs. 15,000)
Bank of Baroda 8.60% onwards 0.25% – 0.50% of the loan amount (Min. Rs. 8,500 and Max. 15,000)
IIFL 10.25% onwards Rs 3000 to 0.75% of the loan amount
DBS Bank 9.45% onwards Up to Rs. 10,000
Bajaj Finserv 8.80% onwards Up to 1.20% of the loan amount
Citibank 8.75% onwards Up to Rs. 5000
Central Bank of India 9.50% onwards Up to 0.50% of the loan amount
Federal Bank 8.75% onwards 0.50% of the loan amount (Min. Rs. 3,000; Max. Rs. 7,500)
Fullerton India 8.75% onwards Up to 3% of the loan amount
Karur Vysya Bank 8.90% onwards Rs. 2,500 – Rs. 7,500
India Shelter Finance Corp. Ltd. 13.00% onwards 2% – 3% of the loan amount

*GST rates could be applicable depending on banks.

According to me, when choosing any bank for a home loan, do not just walk for the lowest interest rate, but check the whole deal.

Parameters like debt repayment and prepayment policies are very important

Now we will compare different banks that offer home loans in India and after looking at the classification, you will be able to clearly understand which bank home loan is best for you, because the best relative term for all is –

LIC Housing Finance Home Loan

Fixed Interest Rate Not offered
Floating Interest Rate 8.7%-9.05%
Processing Fees 0.5% of the loan up to a maximum of Rs. 10,000
Maximum Tenure 30 years,
and cannot extend beyond 60 years.
Pre-closure Charges Nil
LTV 85% for loans up to 20 Lakhs
80% for loans above 20 Lakhs and up to 75 Lakhs
75% for loans above 75 lakhs
Part-Payment Charges Nil

ICICI Home Loan

Fixed Interest Rate 9.9% – 10.25%
Floating Interest Rate 9.15% – 9.6%
Processing Fees 0.50% – 1.00% of the loan amount or
Rs. 1500/-whichever is higher
(Rs. 2000/- for Mumbai, Delhi & Bangalore)
Maximum Tenure 30 years
Pre-closure Charges Nil for floating rate loans
2% for fixed-rate loans.
LTV 90% for loan value less than Rs. 20 lakhs
80% for loan value more than 20 lakhs
75% for loans above Rs. 75 lakhs.
Part-Payment Charges No charges for part-payment
Min. part-payment should be equal to one EMI

State Bank of India Home Loan

Fixed Interest Rate None
Floating Interest Rate 8.7% – 9.1%
MaxGain interest rate
(Overdraft Loan interest rate)
8.75% – 9.45%
Processing Fees Up to Rs. 10,000
Maximum Tenure 30 years
Pre-closure Charges Nil
LTV 90% for – < Rs. 20 lakhs
80% for – > 20 lakhs
Part-Payment Charges Nil

Indiabulls Home Finance

Fixed and Floating Interest Rate 9.25%-11.2%
Floating Interest Rate 8.8%-11%
Processing Fees 0.5%-1% for loans above Rs. 30 lakhs
Rs. 10,000 for the rest
Maximum Tenure 30 years,
cannot extend beyond 60 years.
Pre-closure Charges Nil for floating rate loans
For fixed-rate loans:
a. Nil if paid from own sources
b. 2% if refinanced
LTV 90% for loan value less than Rs. 30 lakhs
80% for loan value of more than 30 lakhs.
Part-Payment Charges Nil

PNB Housing Finance

Floating Interest Rate 8.99% -11.5%
Fixed Interest Rate 9.5% -12.0%
Processing Fees 0.35% of the loan amount
(min of Rs. 2500 and max. of Rs. 15000)
Maximum Tenure 30 years, and cannot extend beyond 60 years.
Pre-closure Charges Nil for floating rate loans
Fixed-rate loans:
a. Nil if paid from own sources
b. 2% if refinanced.
LTV 90% for loan value less than Rs. 30 lakhs
80% for loan value of more than 30 lakhs.
Part-Payment Charges Nil

Bank of Baroda Home Loan

Fixed Interest Rate Not offered.
Floating Interest Rate 8.65% -11.25%
Processing Fees Fixed fee of Rs. 7500
Maximum Tenure 30 years,
Can extend up to 70 years subject to Ts & Cs.
Pre-closure Charges Nil
LTV 90% for loan value less than Rs. 30 lakhs
80% for loan value of more than 30 lakhs
Part-Payment Charges Nil

HDFC Home Loan

TruFixed Interest Rate 9.3% – 10.05%
Floating Interest Rate 8.8% – 9.55%
Processing Fees 0.50% or Rs. 3000/- whichever is higher.
Maximum Tenure 30 years
Pre-closure Charges Nil if paid from own sources and 2% if refinanced.
LTV 90% for loan value less than Rs. 20 lakhs
80% for loan value more than 20 lakhs
75% for loans above Rs. 75 lakhs
Part-Payment Charges Nil

Step by step process of applying for loan:

  • Home loan eligibility
  • Cibil score
  • Rate interest
  • rates loan
  • application
  • Bank valuation
  • Loan approval
  • Legal evaluation of documents  
  • Valuation check  
  • loan agreement
  • Loan Payment

There are many banks or NBFCs in the market that offer home loans with the lowest interest rates.

No one can directly suggest the name of any bank or NBFC that you should like, as all of them get many features and benefits, but it is entirely up to you that your eligibility and Matches the requirement.

Select all the well-known financial institutions and compare their features, benefits and rate of interest. Choose the best bank or NBFC that offers:

  • Low rate of interest (<= 9.50%)
  • continued foreclosure charges
  • Flexi scheme
  • 3 EMI free months
  • Part prepayment facility
  • online account access
  • Other features and benefits such as life insurance policy

I hope you have understood which bank is best for you for taking a home loan. Thanks for reading.

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