Borrowers Weigh Interest Rate Options from Banks and Housing Finance Institutions for Home Purchases
Home Loan Interest Rate Comparison
Homebuyers can significantly reduce their overall cost by comparing home loan interest rates across various lenders. The interest rates offered by banks and housing finance companies vary depending on the borrower's profile and loan amount, making it essential to review multiple options before finalizing a lender.
Reserve Bank of India (RBI) Monetary Policy
The RBI's monetary policy is closely linked to home loan interest rates. In its February monetary policy review, the central bank kept the repo rate unchanged at 5.25%.
Home Loan Rates by Lender
Public Sector Banks
| Lender | Interest Rate Range |
|---|---|
| State Bank of India | 7.25% - 8.70% |
| Bank of Baroda | 7.20% - 9.25% |
| Union Bank of India | 7.15% - 9.50% |
| Punjab National Bank | 7.20% - 9.10% |
| Bank of India | 7.10% - 10.25% |
| Canara Bank | 7.15% - 10.00% |
| UCO Bank | 7.15% - 9.25% |
Private Sector Banks
Read also: Missing a Single EMI Payment Can Adversely Impact Credit Profile
| Lender | Interest Rate Range |
|---|---|
| Kotak Mahindra Bank | 7.70% (onwards) |
| ICICI Bank | 7.45% (onwards) |
| Axis Bank | 8.00% - 11.90% |
| HSBC Bank | 7.45% (onwards) |
| South Indian Bank | 7.20% (onwards) |
| Karur Vysya Bank | 8.50% - 10.65% |
| Karnataka Bank | 7.30% - 11.68% |
Housing Finance Companies (HFCs)
| Lender | Interest Rate Range |
|---|---|
| LIC Housing Finance | 7.15% (onwards) |
| Bajaj Housing Finance | 7.15% (onwards) |
| Tata Capital | 7.50% (onwards) |
| PNB Housing Finance | 7.50% (onwards) |
| GIC Housing Finance | 8.20% (onwards) |
| ICICI Home Finance | 7.50% (onwards) |
| Godrej Housing Finance | 7.60% (onwards) |
Cheapest Home Loan Interest Rates
Most lenders offer their lowest home loan interest rates to borrowers with high credit scores (typically 800 or above). Interest rates may also differ depending on a borrower's employment status, with varying terms for salaried and self-employed individuals.
RBI's Next Monetary Policy Committee (MPC)
The RBI's MPC is scheduled to meet from April 7 to April 9. The committee will review inflation trends, economic growth, and global developments before taking a rate decision.
Investor Takeaway
Compare home loan interest rates across lenders to make a significant difference in overall cost.
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