A "low interest" loan shouldn't mean you have very little interest in paying it back!
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Avail home loans up to Rs.10 crore with interest rates starting at 8.50% p.a. with additional benefits such as extended loan terms and flexible repayment options. Simple documentation, quick processing, and an excellent customer service with a response time of 30 – 45 minutes makes BankBazaar a go-to place for all your housing loan needs.
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| 1 Year | 10.85% p.a. | 0.35% of loan amount (min. Rs.5,000)* | NIL |
| 2 Years | 11.85% p.a. | 0.35% of loan amount (min. Rs.5,000)* | NIL |
*Processing fee waived until 31 May 2019
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 8.55% p.a. | Rs.5,000 to Rs.10,000 + applicable tax | Floating rate: Nil Fixed rate : 2% of the principal outstanding |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
starts @ 8.70% p.a. |
0.5% of loan amount (min. Rs.1,500; max. Rs.10,000) | Nil on floating rate loans |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 8.55% p.a. | Rs.5,000 - Rs.10,000 plus applicable tax | Floating rate: Nil; Fixed rate: 2% of the principal outstanding |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years | 8.80% p.a. | 0.5% of loan amount (min. Rs.10,000) | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 8.70% p.a. |
0.50% of the loan amount (min. Rs.1,500; max. Rs.10,000) |
Nil on floating rate loans |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years | 9.00% p.a. | 0.5% of loan amount (min. Rs.10,000) | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 15 years or Age 70 years | Starts at 8.95% p.a. | Up to 0.25% of the loan amount (max. Rs.25,000) | Floating rate: Nil; Fixed rate: Nil or 2% of the loan amount |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years | 8.50% p.a. | Nil | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
starts at 8.90% p.a. |
Up to 1% of the loan amount (min. Rs.10,000) | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 8.55% p.a. |
0.50% of the loan amount (max. Rs.11,800) | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 8.70% p.a. |
0.50% of the loan amount (max. Rs.11,800) | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 10 years |
Starts at 9.75% p.a. |
Rs.2,500 or the applicable processing fee (whichever is lower) + GST | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 8.50% p.a. |
Rs.2,000 – Rs.10,000 plus applicable tax | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 10.10% p.a. |
Up to 0.50% of the loan amount (min. Rs.10,000) | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 8.55% p.a. |
0.50% of the loan amount (max. Rs.11,800) | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 10 years |
Starts at 9.10% p.a. |
0.35% of the loan amount (min. Rs.2,000; max. Rs.10,000) | Nil |
| Loan Tenure | Rate of Interest | Processing Fee | Prepayment/foreclosure Penalty |
|---|---|---|---|
| Up to 30 years |
Starts at 8.55% p.a. |
Up to 0.50% of the loan amount or Rs.3,000 (whichever is higher) + applicable taxes | Floating Rate: Nil; Fixed Rate: 2% of the loan amount being prepaid through refinance |
| Eligibility Criteria | Requirement |
| Age | Minimum Age: 18 years and Maximum Age: 70 years |
| Resident Type | The applicant must be (any one):
|
| Employment | The applicant can be (any one):
|
| Net Annual Income | At least Rs.5-6 lakh depending on the type of employment |
| Residence | The applicant must have (any one):
|
| Credit score | A good credit score of at least 750 or more obtained from a recognised credit bureau |
| Identity Proof (any one) | Residence Proof (any one) | Other Documents |
| Driving License | Copy of Electricity Bill/Water Bill/Telephone Bill | Employer Identity Card |
| PAN | Copy of valid Passport/Aadhar Card/Driving License | Duly filled loan application form affixed with 3 passport size photographs |
| Voter ID | Loan account statement for the previous 12 months if the applicant has any other ongoing loan from other banks/financial institutions | |
| Valid Passport | Bank account statements for all the bank accounts owned by the applicant for the last six months |
| For Self-employed Applicant/Co-applicant: | For Salaried Applicant/Co-applicant: |
| Income Tax Returns for the last 3 years | Salary Slips for the last three months |
| Certificate of Qualification (for Doctors/C.A. and other professionals) | Copy of Form 16 or Income Tax Returns for the last two years |
| Balance Sheet audited by a certified C.A and Profit and Loss account for the previous 3 years | |
| Business License Details | |
| Business address proof | |
| TDS Certificate |
| Identity Proof (any one) | Residence Proof (any one) | Other Documents |
| PAN | Telephone bill | Attested copy of the applicant’s/co-applicants’/guarantor’s valid passport and visa |
| Valid Passport | Electricity bill | Proof of residence indicating the applicant’s current overseas address |
| Driver’s License | Water bill | Employer Identity Card |
| Voter ID Card | Piped Gas bill | If the applicant is employed in the Merchant Navy, the applicant is required to submit a copy of Continuous Discharge Certificate (CDC) |
| Valid Passport | PIO Card issued by the Government of India in case the applicant/co-applicant is a Person of Indian Origin (PIO). | |
| Driving License | The completed loan application form duly filled with three passport size photographs of the applicant and co-applicants. | |
| Aadhar Card | The attestation of the documents can be done by: 1. Indian Embassy/Consulate 2. Overseas Notary Public 3. FOs/Representative Offices 4. Officials of Branch/Sourcing Units based in India |
| For Self-employed Applicant/Co-applicant | For Salaried Applicant/Co-applicant |
| Proof of income if the applicant/co-applicant is a self-employed professional/businessman. | Valid work permit |
| Business address proof | Employment contract (translated in English) attested by the employer/consulate/embassy/Indian foreign office if the contract is in another language. |
| Balance Sheet and Profit and Loss accounts audited by a certified CA for the last 2 years | Salary slips for the last 3 months |
| Individual Tax Return for the last 2 years – Not applicable to NRIs/PIOs located in the Middle East countries. | Bank statements indicating salary credit for the last 6 months |
| Bank statement of the individual’s as well as the business/company’s overseas account for the last 6 months. | Copy of the Identity Card issued by the current employer along with the latest salary slip (original). |
| Copy of the individual Tax Return for the last assessment year. - Not applicable to employees in the Merchant Navy and NRIs/PIOs located in the Middle East countries. |
Depending on the type of loan you are applying for, the following charges may be levied:
BankBazaar helps you track your loan application easily. Simply visit application status, enter your Application ID and your mobile number, and get the status.
Banks in India provide different types of housing finance options for different purposes. Here’s a list of the prominent types of housing loans in India, based on a study of products offered by some of the top banks:
| Do's | Don't |
|---|---|
| Ensure that you have researched on the loan you want to apply for | Do not blindly sign the documents before you read every term and condition on it |
| Read the fine print before taking the loan | Do not forget to compare interest rates offered by different loan providers |
| Look out for any charges applicable on prepayments and foreclosure | Do not default on your monthly payments |
| Make sure you pay the equated monthly instalments (EMIs) on time | Do not apply for a loan just for the sake of it |
| Ensure that you have a good credit score before you apply | Do not sign the home loan agreement before reading the clauses |
| Apply for a loan amount you are eligible for | Do not request for a change in tenure unless you have considered all the aspects |
| Submit all the necessary documents | Do not submit an incomplete or mismatched loan application |
| Ensure that you have stable employment | Do not have too many ongoing loans |
You can always re-apply for a home loan if your first loan application was rejected by the lender. However, there are a few aspects you must consider before doing so.
Credit score: Since housing loans are generally long-term retail loans, lenders look into the applicant’s repayment capacity before approving or rejecting a loan application. Your credit score plays a major role in deciding your repayment capacity against a loan.
If you have a poor credit score on your credit report, chances of your loan application being rejected are high. The unsatisfactory credit score gauges your creditworthiness which banks and financial institutions consider before processing your loan application. Hence, it is advised to go through your credit score and credit report before you apply for a loan.
In case you have a poor credit score, consider improving your score by making your debt repayments on time before you reapply for a housing loan again. If you do not know what your current score is, you can get your credit score along with the credit report on BankBazaar.
Loan Amount: Since purchasing/constructing a home is a one-time investment, we often tend to overlook the financial costs involved in it. Banks and financial institutions fix the maximum loan amount you are eligible for by taking your present monthly income. There is a high chance your application was rejected because of the loan amount you have applied for.
If the loan amount applied for exceeds your eligible loan amount, the lender can decide to reject your application. In such cases, you can consider increasing the down payment on your home loan to bring down the loan amount.
Other Ongoing Loans: Banks can also choose to reject your home loan application if you have too many other ongoing loans. Since home loan lenders see to it that not more than 50% of your monthly income is being contributed to your loan repayments, any other ongoing long-term loans can result in your application being rejected.
Having too many ongoing loans will not only impact your personal finances but also your repayment capacity. Hence, it is advised to clear the ongoing loans, if any, before you apply for a housing loan.
Co-applicant: There can be instances where applications are rejected due to low income. In such cases, you can consider adding a co-applicant such as a member of your immediate family. This will increase the maximum amount you are eligible for as the income and creditworthiness of the co-applicant will also be taken into account while deciding your eligibility.
Employment: In some cases, the employment of the applicant can act as the deciding factor on whether the loan application is being approved or rejected by the lender. Your application can be rejected if the lender learns that you have been switching between jobs frequently.
Unstable employment can sometimes prove to have a negative impact on your loan application. On the other hand, stable employment with a recognised institution on your application can have a positive impact.
In case your housing loan application was rejected, and you have only been working with the current employer for a short period of time. You can consider giving it some more time before re-applying for another one.
Documentation: Housing loans include a lot of documentation such as identity proof, residential proof, bank account statements, income tax returns, income proofs, property papers, documents approved by concerned authorities, etc. Your loan lender can reject your loan application even if one of the required documents are not submitted.
You can always consult the banks’ customer relationship executives to assist you with proper loan documentation.
Banks/financial institutions consider the following factors when determining your loan eligibility:
The rate of interest associated with fixed rate loans remain unchanged during the entire tenure of the loan. On the other hand, the interest rates applicable on floating rate loans can be revised from time to time depending on the RBI key policy rates. The equated monthly instalments can increase or decrease depending on the prevailing RBI rates in the case floating rate type loans.
Yes, you can choose to prepay your outstanding loan amount either partially or in full before the completion of your loan tenure. While banks do not charge any prepayment fee on floating rate loans, fixed rate home loans attract a penalty up to 2% of the loan amount if prepaid through refinance.
Yes, you can avail tax benefits on both the interest and principal component paid against your home loan. As per Section 80C of the Income Tax Act, you can avail deductions up to Rs.1.50 lakh on the principal amount repaid annually.
Under Section 24 of the IT Act, taxpayers are also eligible for benefits up to Rs.2 lakh on the interest repaid against a home loan annually.
The co-applicant can be an immediate family member such as your spouse, your parents or even your major children. It is also mandatory for all co-owners of the property to be co-applicants while applying for a loan. However, the co-applicant need not be a co-owner.
Pre-EMI is defined as the interest that is to be paid to the loan provider until the entire loan amount is disbursed. The Pre-EMI is payable on a monthly basis until the last disbursement, post which the regular EMI will be applicable comprising the principal and interest components.
Marginal Cost of funds based Lending Rate is the benchmark rate set by a lending institution below which they cannot provide loans to their customers.
Yes, you can switch from a fixed to floating rate of interest on your home loan during the repayment tenure. However, you will be charged a conversion fee by the lender in such cases.
The loan repayment period begins only after the loan provider has disbursed the entire home loan amount. However, you will be required to pay the interest i.e. pre-EMI on the partially disbursed loan on a monthly basis, in most cases.
Yes, you can take 2 home loans at the same time provided that your lender approves your eligibility to manage 2 Equated Monthly Instalments (EMIs) at the same time. However, the tax benefits on the second house will be different and you will be required to establish the property as self-occupied or let-out property.
No. Banks/financial institution do not grant 100% of the property value as home loan. Home loan lenders establish a margin on their loan i.e. the percentage of the cost that the lending institution will be covering. For example, if the margin on the loan is set at 10%, the bank will cover 90% of property value. In such cases, you will be required to a make a down payment of the balance amount, i.e. 10% in order to cover for the rest of the cost.
When determining your home loan eligibility, the lender makes sure that your monthly repayments are not being affected by any other ongoing loans such as personal loan, two-wheeler loan, etc. However, other ongoing loans ultimately tend to affect your eligibility as your overall spending power is reduced. If your other loan commitments exceed 50%-60% of your monthly income, your home loan application may be rejected.
If you are buying a house, home loan is the best option. Usually you will not be eligible for a personal loan for as high an amount required for the purchase of a house. If you want extra money for non-specific personal needs, then go for a personal loan. Home loans also have an added advantage of top-up loans wherein you can request a top up on your loan amount to cover additional needs such as furnishing your house.
No, you cannot avail two home loans for the same property. Any such practice will be considered fraudulent. The Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) ensures that fraudulent practices such as availing two housing loans for the same asset/property are prevented.
A joint home loan can be availed by adding a co-applicant such as your spouse, parents, or an immediate family member on your application. Adding a co-applicant will increase your home loan eligibility as the lending institution will also be considering the co-applicant's income and credit score when determining your loan eligibility. All co-owners of the property are required to be the co-applicant for a loan. However, the co-applicants need not necessarily be the co-owner of the concerned property.
With the view of helping homebuyers recover their money, the National Consumer Disputes Redressal Commission (NCDRC) has asked builders to refund money for delayed projects with interest at the rate at which a nationalised bank offer home loans to customers. The commission also added that builders will have to pay compensation and litigation cost to homebuyers who seek refund.
It needs to be mentioned here that a bench of S M Kantikar and Dinesh Singh on the issue of interest rate stated that given the absence of any uniformity in the decisions delivered by various consumer forums with regard to interest rate linking it with home loan rates was ‘logical and appropriate’.
NCDRC passed the order based on a plea of 20 homebuyers who had spent around Rs.10 crore in Wave Garden housing project in Mohali in 2012. The builders had promised to hand over possession of flats within 3 years but till date they have failed to do so.
12 July 2019
Today, in her Union Budget speech, Finance Minister, Smt Nirmala Sitharaman put forth a proposal to regulate the housing finance sector.
Smt Sitharaman proposed that the Reserve Bank of India (RBI) should be given required powers to regulate the housing finance companies.
This will lead to HFC lenders now having to face strict asset quality reviews. In addition to this extra scrutiny, this move could also lead to HFCs having to pay hefty penalties and have restrictions placed on their activities if anything untoward is to be discovered.
In fact, this new proposal could seriously impact around 80 housing finance corporations in India. Some of the large HFCs that will be affected include Indiabulls Housing Finance Ltd., Dewan Housing Finance Corporation, and Housing Development Finance Corporation.
5 July 2019
Minister of state for housing and urban affairs, Hardeep Singh Puri has stated that promoters should not promote or sell any real state project including plots, flats or building without registering it under the Real Estate Regulatory Authority established under Real Estate (Regulation and Development) Act, 2016). He was replying to a query raised by YSR Congress (YSRC) MP V Vijay Reddy in Rajya Sabha. As per Section 59 of the RERA, 2016, a promoter or builder is liable to be imprisoned for three years or pay a fine of 10% of the project cost if he was not registered under RERA. He also added that in some cases, the builder or the promoter can be imposed with both fin as well as imprisonment.
Puri further stated that the real estate regulatory authority of the concerned state and Union Territory (UT) is required to publish and maintain records of real estate projects by builders. He added that a completion certificate will be given to promoters within a period of three months for all projects that were under way on the date of commencement of RERA for which certificate has not been issued. The buyers may approach the relevant forum based on the facts and circumstances according to applicable laws.
5 July 2019
The Reserve Bank of India (RBI) cut interest rates by 25 basis points for the third time this year and indicated at more reductions by revising its policy stance from ‘neutral’ to ‘accommodative’. This move is expected to mortgage, vehicle loans, and other borrowings cheaper. With the backing of muted inflation and the availability of buffer food grain stock, the RBI’s monetary policy committee (MPC) voted unanimously to reduce the repo rate from 6% to 5.75%, the lowest since 2010. Repo rate is the price commercial banks to pay to the RBI for short-term funds. Announcing the cut in Repo rate, the RBI governor Shaktikanta Das said that the growth impulses had weakened sharply. He added that a significant slowdown in investment activity, along with a continuing moderation in private consumption growth, is a matter of concern. Also, he said that the move to the stance of ‘accommodative’ means that rate increases were off the table from now.
As for comments that the previous two rate cuts were not passed on, he said that banks have passed on 21 basis points through a cut in lending rates. He added that in the past the transmission took nearly four to six months; however, this time it has happened in two to three months’ time and going forward the RBI expects it to be faster and higher transmission by banks.
7 June 2019
Housing sales have increased by leaps and bounds after slash in home loan interest rates, as per reports. If reports a re to believed, total sales rose by 71% in the first quarter of 2019, a massive increase compared to last year in the same quarter where around 46,000 units were sold.
The past four years have been pretty dismal for the real estate sector. The stagnation in house sales was palpable. This year, following cuts in Goods and Services Tax (GST) and home loan rates have helped the real estate industry recover from the losses it had incurred in the past.
Among the 9 cities that witnessed whopping sales this quarter, Bangalore tops the list with its unsold units going down by 44%. Hyderabad clocked 21% dip in unsold inventories while Delhi recorded 18% dip, as per reports. Surprisingly, Mumbai witnessed only 4% dip in its unsold units, which is not that great.
As of now, there are still6.65 lakh units that are yet to be sold across seven cities, including Delhi, Mumbai, Bengaluru, Kolkata, Hyderabad, Pune, and Chennai. It’s being speculated that the remaining units will be sold within the next 30 months.
Better property rates is also being touted as one of the major factors behind the growth of housing sales.
31 May 2019
Reserve Bank of India, the country’s central bank has asked banks to increase the cap on home loans for RRBs and SFBs. It has directed the cap under priority sector lending (PSL) to be increased to Rs.35 lakh in metropolitan centres and Rs.25 lakh in other centres.
Going forward housing loans up to the amounts mentioned above can be availed from RRBs and SFBs provided the overall cost of the dwelling units does not exceed Rs.45 lakh and Rs.35 lakh respectively. If the overall cost of the dwelling unit does not exceed Rs.35 lakh and Rs,25 lakh, loans up to Rs,28 lakh in metropolitan cities and Rs.20 lakh in other centres would be provided by RRBs and SFBs.
It needs to be mentioned here that RBI in a notification also informed that the family income limit eligible for loans to housing projects for the purpose of construction of houses has been revised for EWS and LIG categories. The limit has been revised to Rs.3 lakh and Rs.6 lakh per annum in order to align it with the income criteria set under PMAY scheme.
10 May 2019
In attempt to end homelessness, Kerala is offering free flats to the homeless. According to reports, around 145 families moved into their newly constructed homes in the town of Adimali. Speaking on the project, U.V. Jose, chief executive of LIFE Mission, said that the state plans to construct more than 4 lakh homes to provide shelter for the homeless.
Speaking to the media, Jose said that most of the economically backward classes cannot afford a home, which is a basic necessity. He further added that with a home, the said section of people will be more confident in their lives, which might enable them to focus on other matters that may help improve their quality of life.
As per reports, each unit is estimated to be around Rs.4 lakh. The entire amount will be sponsored by the state government.
As per reports, there are around 1.77 million homeless people nationwide.
8 May 2019
Reserve Bank of India (RBI) in a bid to bring RRBs and SFBs to a level playing ground with scheduled commercial banks has decided to increase housing loan limits for eligibility under priority sector lending (PSL). The central bank has raised the housing loan limits under PSL to Rs.35 lakh in metro cities and Rs.25 lakh in other cities. To be eligible the overall cost of the dwelling unit in the metropolitan city must not be in excess of Rs.45 lakh while for other cities it should exceed Rs.30 lakh.
It needs to be mentioned here that the existing family income limit needed to be eligible for loans to housing projects for construction of houses for economically weaker sections and low income groups have been revised. The amount has been increased to Rs.3 lakh per annum from economically weaker sections and Rs.6 lakh for low income groups. The move has been aimed at bringing the amount in alignment with criteria specified under Pradhan Mantri Awas Yojana.
With the new developments taking place, RRBs and SFBs have been allowed to calculate their outstanding portfolio of housing loans and ensure that they meet the revised criteria for classification under PSL.
8 May 2019
Finance Minister Arun Jaitley has stated that the government plans to make home loan EMIs cheaper than house rent. The recent development of cutting the repo rate by RBI was a step in that direction.
The minister while speaking at an industry event stated that the government has been able to double the tax base and increase the collection of taxes without increased the tax rates in the last five years. He added that if voted to power, the government will continue to pursue policies to help in reducing the interest rates and ensure fiscal consolidation.
The finance minister said that the BJP-led government was consciously trying to strengthen the middle class of the country. This was because of the fact that the future of the Indian economy was the middle and the neo-middle class.
26 April 2019
The country’s apex court recently empowered home buyers to claim refunds from builders if there was an unreasonable delay in handing over possession of their homes. The directive came after the top court heard the case - Kolkata West International City Pvt. Ltd Vs Devasis Rudra.
Supreme Court after hearing the case stated that a wait of seven years for possession is beyond what is reasonable for. The court said that it was unfair to non-suit the buyer on the basis that the first prayer for reliefs was sought before the West Bengal State Consumer Dispute Redressal Commission (SCDRC). It added that the orders passed by the SCDRC and the NCDRC for refunds were justified.
It needs to be mentioned here that the Kolkata West International City Pvt. Ltd Vs Devasis Rudra case pertains to the buyer paying Rs.39,29,280 to the builder in 2006 for the handover to the flat in December 2008 with a grace period of six months ending in the month of June 2009.
16 April 2019
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