Have you been looking to apply for a home loan but not satisfied with the rate offered to you? Home loans have always been the cheapest loan still a borrower wants to get the lowest possible rate.
The reason behind this that unlike other loans such as personal loans where the maximum tenure is 5 years (mostly), a home loan can be taken for a maximum tenure of 30-40 years. As a result of which, a borrower wants to get the best rate so that the EMI payment is smoother for the whole tenure. There is also an option to balance transfer your loan to pay lower EMIs.
What are the factors based on which you get the rate?
You should know that banks and NBFCs have certain criteria based on which they considered you loan application suitable for the lowest rate. These factors include your age, the property value as in the location, your income, credit history, professional stability, investments, and relationship with the lender.
Monthly Income- The higher you will earn, the more loan amount you can get. So, the applicants who have a handsome monthly salary are most likely to get low-interest rates as well.
Age- If you are a young professional, you will obviously have less financial responsibilities on your shoulders. Hence, a young professional can get an overall great deal of home loans as his eligibility is higher.
Property Value- When you buy a property from an authorized dealer, banks will find it easier to finance that property. So, it is advisable to go for a property that would make the loan application easier.
Credit History- Be it any loan, having a good credit history is very important as lenders would trust you on the basis of your credit score also. Since defaulters are not much acceptable by the banks for any kind of loan.
Work Experience- The stability in the present organization is also another important factors when it comes to housing loan eligibility. Having said that, generally, 2-3 years of job stability is required by the bank for a home loan.
Your Employer Category– Banks and lenders generally trust applicants who are working in a reputed firm or MNC. So, if you are one of them, good for you!
Professional/Business Status– In the case of self-employed, there must be a good business running experience of an impressive stability in the present profession.
Relationship with Lender- If you are an existing customer or a borrower, it will add on to a plus point for you.
What are the lowest home loan rates in India?
The moment you think of applying for a home loan, you must do a proper research regarding the rate and other offers. This will help you in choosing the right lender. For your reference, here are the lowest home loan interest rates at top banks in India:
SBI- The starting rate of interest you can get for home loans is 8.30% per annum for women applicants and 8.35% per annum for other applicants.
HDFC Ltd- The home loan is disbursed at the present rate of interest starting from 8.35% per annum and goes up to 8.95% per annum.
LIC Housing Finance- The interest rate on a housing loan for variable loan amounts is mentioned below:
- Up to ₹1 lakh to 35 lakhs- 8.35% p.a. (for women) and 8.40% p.a. (for others)
- From ₹30 lakhs and ₹2 crores – 8.50% p.a. (for all)
- From ₹2 crore to ₹5 crores- 8.70% p.a. (for all)
Axis Bank- The home loan rate at Axis Bank is presently at 8.35% per annum onwards. The processing fee applicable to home loans is up to 1% of the loan amount plus applicable taxes that is GST.
Bank of Baroda- The interest rate on home loans starts from 8.30% per annum and goes up to 9.30% per annum.
How can you calculate your home loan eligibility?
With the term home loan eligibility calculator, we mean the maximum loan amount you can get on the basis of your income and savings. Otherwise, there is a different criteria for home loans at different lenders. For instance, if your monthly saving is ₹50,000 and you are looking for a home loan, here is how much you can get:
Amount: ₹1 lakh
Loan Tenure: 30 years
Rate of Interest: 8.30%
Your per lakh EMI will be: ₹755
Maximum loan amount = (₹1,00,000 X 50,000) / ₹755 = ₹66,22,516 (approx.)