By A home is a fundamental part of a person’s personality. We all dream of having a perfect home where we can unwind at the end of the day. There are times when a person may require to borrow some money to complete a venture, well in when the venture is a house, that’s when a home loan enters the picture. Buying a home is a dream for most people. Unfortunately, considering the current property rates, an average salaried person might not be able to buy a house all by him/herself.
As real estate prices continue to rise, a growing number of people are opting for home loans to purchase their dream homes. A home loan can also be taken for buying a plot, renovations, or even for repairs in the existing house. Finding the best deals on home loans can be a bit of a task. You need to make sure your credit score is decent enough and all of the documentation is needed on point. In addition to that, you need to gather as much knowledge as you can, finding the lowest home loan interest rate and the bank which provides the same.
Basic Understanding about Home Loans:
A home loan or a house loan is when you borrow a sum of money from the bank or an NBFC to purchase a property or repair it. This type of loan is usually a long term loan and easily lasts for more than 10-15 years, keeping you occupied for a long time. If you do not have enough clarity, it can cost you a lot of money.
These days banks and other financial establishments have come up with different types of home loans. Here are a few types:
Loans to purchase land: For people who just want to invest in the land. They might later construct something on it or simply retain it as one of their investments.
Loans to purchase a house: Home loans were particularly devised to lend someone funds to buy a house.
Loans for construction of a house: Well, unlike others some people believe in constructing their own house. According to them, it is better to customise every part of their future home. In this scenario, the cost of the land is also taken into account.
Home conversion loans: People who already have an ongoing home loan, but are considering some new house can opt for this loan. Borrowers can fund the purchase of a new home by transferring the existing loan to the new home, while not having to repay the previous home loan.
Eligibility Criteria for Home Loans:
While it is not very difficult to get a home loan, there are a few parameters you need to go through before you can apply for a loan. All banks and NBFCs have their screening process before they sanction a loan to anyone. However, these banks and NBFCs have a very similar list of parameters. Let’s get into further details.
- The person applying for a home loan needs to be between 18-70 years of age.
- The applicant should have a minimum salary of rupees 25,000.
- Both salaried and non-salaried can apply.
- NRI and residents can apply.
- Maintain a credit score above 750.
- A minimum of 2 years of work experience is mandatory to apply for a home loan.
The bank or the NBFCs are the deciding authority. They will sanction the loan and also decide the final loan amount after you have passed all the set parameters.
Even though we have previously mentioned that applicants between 18-70 years of age are eligible. However, for a senior citizen, it can be difficult to get a home loan sanctioned. There is no reason to lose heart if you are already retired and want to buy your own house. Thankfully, there are financial establishments, that have specially curated home loans for senior citizens and pensioners.
Quick notes about a Home Loan:
Check out the pointers below to gain a quick update/idea about home loans
- When you take a home loan you are providing your home as collateral or security until you repay the loan. Therefore, it is good to be aware that if you ever fail to repay the amount, the bank or the NBFC is legally allowed to claim your property.
- Down payments are the minimum upfront that the borrower pays at the start and most home loans do not cover that.
- The tenure of the loan can be flexible and can range from 10-25 years. The tenure depends on your income, your age, and the loan amount.
- The home loan interest rates can be both fixed or floating. It usually depends on the type of loan you take and the bank involved.
Which Bank offers the Lowest Home Loan Interest Rate?
Banks and NBFCs often state to offer low-interest rates to attract new customers. A home loan as we mentioned earlier is a long term loan, therefore, you should try your best to secure a good deal. The interest rate that you get offered depends on a lot of factors. To secure the lowest home loan interest rate you need to pull some strings. For example, having female co-applicants might help lower the interest rate. Having a great credit score will always help you in locking the lowest interest rate. Also, try to provide all types of authentic documents to the bank. As it will increase your chances of loan approval.
We have shortlisted home loan lowest interest rate banks so that you can get some idea about the current market and make decisions accordingly.
Bank |
Upto 30 lakh |
Above 30 lakh and up to 70 lakh |
Above 75 lakh |
| Bank of Maharashtra | 6.40% – 8.30% | 6.40%-8.45% | 6.40% – 8.55% |
| Bank of India | 6.50% – 7.70% | 6.50%-7.50% | 6.50% – 7.50% |
| Indian Bank | 6.50%-7.70% | 6.50-7.50% | 6.50%-7.50% |
| Kotak Mahindra | 6.55% onwards | onwards 6.55% | 6.55% onwards |
| ICICI Bank | 6.70% – 7.55% | 6.70%-7.55% | 6.70% – 7.55% |
| State Bank of India | 6.70% – 7.65% | 6.70%-7.65% | 6.70% – 7.65% |
Bank of Maharashtra Home Loan Features:
As evident from the table above, Bank of Maharashtra charges the lowest interest rate on home loans amongst all the other public banks. Bank of Maharashtra claims to provide you with a higher loan amount and an easy loan tracking facility. Also, here you can get a loan easily approved without any processing fee or hidden charges alike. Their website provides you with all the required information that an applicant needs to make an informed decision. Thus, if you are considering government banks for a home loan, the Bank of Maharashtra will be a smart choice.
To procure the lowest interest rates on home loans make sure to always maintain a good credit score. Your credit score can get you a lot of benefits while applying for a loan. Once you get a loan, the bank can reassess your interest rate. Since the interest rate depends on external market situations they are very much subject to change.
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