A home loan is a kind of financial support availed from lenders like HFC, banks, etc. for buying or constructing a home. As this loan must be repaid via EMI (equated monthly instalment) over a time period i.e., generally 10-25 years, it is provided by lenders depending on their assessment of your repayment potential besides checking the financial and technical aspects of the property you are looking to. However, as a home loan borrower, you may often wonder as which lender offers the best home loan deal. For this, you must ensure to know about the distinct kinds of home loan lenders available in the market.
What are the kinds of home loan lenders available in the market?
Banks generally are the major home loan providers in India alongside the HFCs. Note that HFCs are specialised NBFCs that deal just with home loan deals. The business of HFC does not involve any other form of banking services such as fund transfer, accepting of deposits, etc. However, note that banks in comparison to HFCs do not offer the best home loan interest rates owing to their less stringent examination process for your home loan application.
Best home loan lenders in India –
The rate of interest is one of the main parameters in selecting the home loan lender as it determines the EMI payable amount. Moreover, other parameters like the qualification for the maximum loan amount, maximum repayment tenure permitted, processing charges and other linked charges, etc. are even factored in.
As all financial institutions tend to comply with the RBI (Reserve Bank of India) guidelines to provide home loans depending on the repo rate, the interest rates on home loans are similar across most lenders with slight differences in basis points. However, as a home loan usually is a higher amount with higher tenure than a personal loan or car loan, even a slight difference of 0.3 per cent in the rate of interest results in a considerable difference in loan EMI and thus the overall payable interest over a long-term. These rates vary according to the loan amount slab.
Compiled here is a list of banks offering a good rate of interest and other criteria –
State Bank of India
Introduced in the year 1955, SBI is one of the largest Indian banks. This bank is a public sector bank with more than 24,000 branches across India and branches abroad.
| Credit Score | Regular home loan | CRE home loan | Top-up loan | Realty loan | Tribal loan | ||||
| Term loan | Max gain | Term loan | Max gain | Term loan | Overdraft | Term loan | CRE term loan | Term loan | |
| Greater than equal to 800 | 8.90 per cent per annum | 9.30 per cent per annum | 9.10 per cent per annum | 9.40 per cent per annum | 9.30 per cent per annum | 9.60 per cent per annum | 9.20 per cent per annum | 9.40 per cent per annum | 9.00 per cent per annum |
| Between 750 and 799 | 9.00 per cent per annum | 9.40 per cent per annum | 9.20 per cent per annum | 9.50 per cent per annum | 9.40 per cent per annum | 9.70 per cent per annum | 9.30 per cent per annum | 9.50 per cent per annum | 9.10 per cent per annum |
| Between 700 and 749 | 9.10 per cent per annum | 9.50 per cent per annum | 9.30 per cent per annum | 9.60 per cent per annum | 9.50 per cent per annum | 9.80 per cent per annum | 9.40 per cent per annum | 9.60 per cent per annum | 9.20 per cent per annum |
| Between 650 and 699 | 9.20 per cent per annum | 9.60 per cent per annum | 9.40 per cent per annum | 9.70 per cent per annum | 9.60 per cent per annum | 9.90 per cent per annum | 9.50 per cent per annum | 9.70 per cent per annum | 9.30 per cent per annum |
| Between 550 – 649 | 9.40 per cent per annum | 9.80 per cent per annum | 9.60 per cent per annum | 9.90 per cent per annum | 9.90 per cent per annum | 10.20 per cent per annum | 9.60 per cent per annum | 9.80 per cent per annum | 9.50 per cent per annum |
| No CIBIL score | 9.10 per cent per annum | 9.50 per cent per annum | 9.30 per cent per annum | 9.60 per cent per annum | 9.50 per cent per annum | 9.80 per cent per annum | 9.40 per cent per annum | 9.60 per cent per annum | 9.20 per cent per annum |
Highest repayment tenure permitted – 30 years
Overall affordability is high
ICICI bank
ICICI bank is an Indian private-sector bank. It is one of the largest Indian banks with 5,000 Indian branches and nearly 17 branches in other countries.
Standard pricing –
For salaried –
| Slab | Floating rate of interest |
| As high as Rs 35 lakh | Repo rate + 2.70 per cent (8.95 per cent) – repo rate + 3.45 per cent (9.70 per cent) |
| Between Rs 35 lakh and Rs 75 lakh | Repo rate + 2.70 per cent (8.95 per cent) – repo rate + 3.45 per cent (9.70 per cent) |
| Over Rs 75 lakh | Repo rate + 2.70 per cent (8.95 per cent) – repo rate + 3.45 per cent (9.70 per cent) |
| Slab | Floating rate of interest |
| Up to Rs 35 lakh | Repo rate + 2.80 per cent (9.05 per cent) – repo rate + 3.60 per cent (9.85 per cent) |
| Between Rs 35 lakh and Rs 75 lakh | Repo rate + 2.80 per cent (9.05 per cent) – repo rate + 3.60 per cent (9.85 per cent) |
| Over Rs 75 lakh | Repo rate + 2.80 per cent (9.05 per cent) – repo rate + 3.60 per cent (9.85 per cent) |
Maximum repayment tenure allowed – 30 years
Overall affordability is high
HDFC bank
HDFC bank is also one of the main commercial Indian banks. It is one of the second-largest Indian banks and has over 5,300 branches. The interest rates for HDFC home loan ranges anywhere between 8.60 per cent and 9.50 per cent per annum. The loan is available for thirty years tenure just like other lenders and comes with a processing fee of up to 0.50 per cent of the loan amount or Rs 3,000, whichever amount is on a higher end.
