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Lowest Home Loan Interest Rates

Banks with lowest Home Loan Rates

Last Updated 31st Oct 2020

Currently, Central Bank of India, Bank of India offers the lowest home loan interest rate of 6.85% and hence, is one of the best banks for home loan. The loan is benchmarked to RLLR. The processing fee levied on Central Bank of India, Bank of India home loan is 0.25% , Min ₹ 1,500, Max ₹ 20,000.

Bank Interest Rate Processing Fee Benchmark Type
Bank of India 6.85% 0.25% , Min ₹ 1,500, Max ₹ 20,000 RLLR
Central Bank of India 6.85% 0.50% , Max ₹ 20,000 RLLR
Axis Bank 6.90% 0.20% , Min ₹ 5,000, Max ₹ 25,000 RLLR
HDFC 6.90% 0.25%, Min ₹ 3,000, Max ₹ 10,000 PLR
ICICI Bank 6.90% 1.00% RLLR
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Best Banks for Home Loan

India has more than 50 banks and HFCs offering home loan which makes choosing the best bank to take a loan a difficult process. The key criteria that should be considered and compared to choose a home loan are the current interest rate, the benchmark type, loan tenure, processing fees, product features as well as level of customer service.
Large government banks like SBI, Bank of Baroda and housing finance companies like LIC Housing Finance and HDFC offer lower discounted rates for small amount home loan below ₹ 30 Lakh. If you are looking to take a home loan of up to ₹ 30 Lakh, here is a list of top ten banks which offer the lowest rates at present.

Bank Interest Rate Processing Fee Benchmark Type
Bank of India 6.85% 0.25% , Min ₹ 1,500, Max ₹ 20,000 RLLR
Central Bank of India 6.85% 0.50% , Max ₹ 20,000 RLLR
Axis Bank 6.90% 0.20% , Min ₹ 5,000, Max ₹ 25,000 RLLR
HDFC 6.90% 0.25%, Min ₹ 3,000, Max ₹ 10,000 PLR
ICICI Bank 6.90% 1.00% RLLR
LIC Housing Finance 6.90% NIL PLR
UCO Bank 6.90% 0.50% , Min ₹ 1,500, Max ₹ 15,000 RLLR
SBI 6.95% 0.20% , Min ₹ 4,000, Max ₹ 17,400 RLLR
Bank of Baroda 7.00% Min ₹ 7,500 RLLR
Citibank 7.05% NIL TBLR

As compared on the loan amount, Central Bank of India, Bank of India offers the lowest interest rate of 6.85% on housing loan which makes it a better option for low value amount.

Banks with lowest home loan rates for female borrowers

Bank Interest Rate Processing Fee Tenure
HDFC 6.90% 0.25%, Min ₹ 3,000 - Max ₹ 10,000 30 years
SBI 6.95% 0.20%, Min ₹ 4,000 - Max ₹ 17,400 30 years
PNB 7.15% 0.35%, Min ₹ 2,500 - Max ₹ 15,000 30 years
Indian Bank 7.55% 0.23%, Max ₹ 20,381 20 years
Syndicate Bank 8.00% 0.13%, Min ₹ 500 - Max ₹ 5,000 30 years

HDFC offers the lowest interest rates on housing loan for women borrowers starting at 6.90%. One can take the home loan in the name of a female applicant to get the benefit of lower interest rates. Other than HDFC, other top lenders offering low interest home loan schemes for female borrowers are SBI, PNB, Indian Bank and Syndicate Bank as per the current rates as on 31 Oct, 2020.

Banks with Zero Processing Fees or Low Processing Fees on Housing Loan

A home loan processing fee is a one -time fee collected by the home loan lender in order to process the loan, get the property valued and verified and complete the loan documentation. The fee is to be paid additionally and is not deducted from the loan amount. Further, most of the time processing fees is non-refundable making it a big cost for any loan borrower. As on Oct 2020, 2 banks charge zero processing fees on home loan making them a preferred choice for any prospective home buyer. Presently, Citibank charges the lowest processing fee on a home loan as a % of loan amount, that is NIL. Citibank have the lowest cap on processing fees, making them a good choice for borrowers like to take a large loan amount.

Bank Processing Fee
SBI 0.20% , Min ₹ 4,000, Max ₹ 17,400
HDFC 0.25%, Min ₹ 3,000, Max ₹ 10,000
Citibank NIL
Bank of Baroda Min ₹ 7,500
ICICI Bank 1.00%

Latest Home Loan Schemes for Balance Transfer

Balance transfer of home loan allows existing home loan borrowers to switch from one lender to another who offers a lower interest rate. A home loan balance transfer is a popular home loan scheme as it is a smart way to lower the home loan repayment. Various lender offers the balance transfer facility as listed below:

Bank Interest Rate Processing Fee Tenure
Bank of India 6.85% 0.25%, Min ₹ 1,500, Max ₹ 20,000 30 years
Central Bank of India 6.85% 0.50%, Max ₹ 20,000 30 years
Axis Bank 6.90% 0.20%, Min ₹ 5,000, Max ₹ 25,000 30 years
HDFC 6.90% 0.25%, Min ₹ 3,000, Max ₹ 10,000 30 years
ICICI Bank 6.90% 0.25%, Min ₹ 5,000, Max ₹ 5,000 30 years

Any applicant who is planning to transfer their home loan can consider opting for home loan transfer with Bank of India as it offers lowest rates on home loan balance transfer starting at 6.85%. Some of the best banks for home loan balance transfer are Central Bank of India, Axis Bank, HDFC and ICICI Bank.

Popular Home Loan Overdraft Schemes

With home loan overdraft facility, you can save interest on the home loan and pay interest only on the utilized amount. This scheme is mostly preferred by self-employed businessman or borrowers who have fluctuating fund requirements. The interest rates on overdraft is 0.10- 0.25% higher than normal home loan rates. Some of the banks that offer overdraft facilities that are quite popular with borrowers.

Bank Overdraft Interest rate Processing Fee Tenure
Axis Bank 6.90% 0.50%, Max ₹ 2,500 30 years
SBI 6.95% 0.20%, Min ₹ 4,000 - Max ₹ 17,400 30 years
Citibank 7.05% 0.20%, Min ₹ 4,000 - Max ₹ 17,400 25 years
IDBI Bank 7.40% 0.50%, Min ₹ 2,500 30 years
Federal Bank 8.35% 0.50%, Min ₹ 3,000 - Max ₹ 7,500 30 years

Current Top Up Rates for Home Loans

A home loan top-up allows one to borrow additional money on an existing home loan. Various banks and financial institutions offer the top-up loan facility to existing home loan borrowers based on their repayment ability. Currently Axis Bank, HDFC, ICICI Bank offers the lowest top-up home loan interest rate of 6.90%.

Bank Top-Up Interest rate Processing Fee Tenure
Axis Bank 6.90% 0.20%, Min ₹ 5,000 - Max ₹ 25,000 30 years
HDFC 6.90% 0.25%, Min ₹ 3,000 - Max ₹ 10,000 30 years
ICICI Bank 6.90% 0.25%, Min ₹ 5,000 - Max ₹ 5,000 30 years
SBI 6.95% 0.20%, Min ₹ 4,000 - Max ₹ 17,400 30 years
Citibank 7.05% 0.25%, Min ₹ 3,000 - Max ₹ 10,000 25 years

FAQs

Which bank is best for lowest home loan interest rates?

As per the current rates, Central Bank of India, Bank of India is offering the lowest interest rate on home loan starting at 6.85% and is one of the best banks for home loan.

Which bank is best for lowest processing fee on home loan?

Citibank is the best bank to take a home loan at NIL processing fee.

Which bank is best for home loan?

HDFC, Axis Bank and ICICI Bank are considered as the best banks for home loan as they are highly customer focussed and offer easy process and quick turn around on home loan.

What is the lowest rates on home loan for female borrowers?

HDFC offers lowest home loan rates for female borrowers starting at 6.90%.

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