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10 Banks Offering Lowest Home Loan Interest Rate
Now is the perfect time to buy your dream house given record low interest rates, host of government incentives such as the affordable housing grant under PMAY which provides interest rate subsidy between 3-6.5%. Here to be mentioned that while the subsidy grant to MIG category has expired, the same can still be availed by EWS and LIG until March 2022. So, as there looms inflationary threat, with WPI inflation climbing to 12-year high for November month and all major global central banks are taking a hawkish stance to tackle inflation, it will not come as a big surprise if RBI takes on to interest rate hike in the next RBI monetary policy committee meet.
So, if you want to capitalise on the current low interest rate regime and want to buy your dream house, here's collated a list of banks offering lowest rates on home loan:
10 Banks offering cheapest home loan or home loan at the lowest interest rate
| Bank | RLLR | For Salaried | For Self-employed | WEF |
|---|---|---|---|---|
| Bank of Maharashtra | 6.80% | 6.4-7.8% | 6.65-8.3% | 8.12.2021 |
| Union Bank of India | 6.80% | 6.4-7.25% | 6.5-7.35% | 27.10.2021 |
| Bank of Baroda | 6.50% | 6.5-7.85% | 6.5-7.85% | 07.10.2021 |
| Bank of India | 6.85% | 6.5-8.2% | 6.5-8.35% | 18.10.2021 |
| Kotak Mahindra Bank | 6.50% | 6.55-7.10% | 6.65-7.25% | |
| Punjab and Sind | 6.60% | 6.6-7.35% | 6.65-7.6% | |
| ICICI Bank | 6.75% | 6.7-7.4% | 6.9-7.55% | 7.04.2021 |
| Axis Bank | 6.75% | 6.75-7.1% | 6.90-7.2% | 1.10.2021 |
| IDBI Bank | 6.75% | 6.75-8.4% | 6.85-9.9% | 24.09.2021 |
| SBI | 6.65% | 6.75-7.15% | 6.9-7.3% | 01.05.2021 |
Source -Bank websites
Note for some of these effective home loan rates, extra concession allowed to women borrowers have also been factored. Say for instance SBI allows 5 bps concession to women borrowers. Also, loans secured through the bank's digital platform are also eligible for a further 5 bps rebate.
Points to note to get a lucrative home loan interest rate in India
Remember home loans are long term loans running into 15 to even 30 years tenure and hence zeroing on the best deal makes high sense. So, here are a few checkpoints that can help you get a lucrative home loan deal.
Interest rate differential of even 0.5 percent means a lot in case of long term loans such as home loans that are usually high ticket loans of over Rs. 20 lakhs to several crores.
For better deals, you can add a co-applicant who is a women borrower to get the concession available to them.
Make a higher down-payment of over 20-25% such that the loan to value ratio is maintained low which then increases your chances of getting the lowest possible interest rate, provided you also hold a good credit record/score.
Home saver loans can always be opted by those without a fixed income stream. These however entail a higher cost of between 0.15-1% as against the regular loans.
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