With the Reserve Bank of India keeping commercial rates unchanged in early June, focus has now shifted towards potential impact on loans for borrowers. Lenders typically tend to revise repo-rate linked loans' interest rates based on the RBI's decision.
Even when the RBI keeps the rates unchanged, banks issue a fresh statement, sharing the latest interest rates for borrowers and any other related updates. As a result, borrowers are advised to keep a keep of these updates to ensure that they do not meet any fiscal surprises.
Due to repo-rate, home loans, car loans and personal loans are usually impacted, while fixed-rate loans remain unchanged. As a result, borrowers paying home loan EMIs linked to repo rates must stay updated.
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Home loan rates are the interest charged by banks or financial institutions on money borrowed to purchase, construct, or renovate a house. In India, home loan interest rates typically vary depending on the lender, borrower's credit score, income stability, loan amount and tenure.
At present, the leading public sector bank, State Bank of India, is offering home loans at rates between 7.25% to 8.55%. Borrowers with premium CIBIL scores of 800 or above, past behaviour of fiscal responsibility and income stability tend to be offered the lower rates, while those with poor records tend to pay higher rates.
Private lender HDFC Bank currently offers home loan interest rates between 7.75% to 13.20% for both salaried and self-employed persons.
Punjab National Bank's home loan interest rates for value above Rs 30 lakh for up to 10 years tenure stands at 8.20%. For duration above 10 years, the rate is 8.70%. To be clear, this rate is applicable for people with CIBIL score of 800 or more. People with lower scores are subjected to higher rates, the bank's website shows.
Similarly, here are home loan rates of top Indian lenders:
- SBI - 7.25% to 8.55%
- HDFC Bank - 7.75% to 13.20%
- PNB - 8.20% (For CIBIL above 800)
- Bank of Maharashtra: Starts at 7.10%; highest - 9.15% (for CIBIL below 600)
- Bank of India - Starting from 7.10%
- Axis Bank - 8.00 to 8.85% (CIBIL above 800)
- Kotak Mahindra Bank - 7.60% p.a. onwards
- Yes Bank - 8.65% onwards
- Canara Bank - 7.15 % to 10.00 %
Most banks offer home loans through a simple step-by-step process. The process is now largely digital, making approval and tracking faster. However, customers are advised to read the fine print thoroughly to understand additional charges such as processing fees, prepayment penalties, etc for optimal management of their home loans.
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Note: Interest rate data sourced from respective banks' websites. Rates are tentative in nature.
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