If you are planning to buy a home and need a loan, this looks like a great opportunity. India’s housing loan segment that is worth over Rs 14 lakh crore is the latest focus of the country’s banks and home finance companies. The financial institutions are vying with each other by offering homeowners with attractive and reduced housing loan rates. The new slashed interest rates are the lowest in nearly 15 years and several banks are ready to join the race.
The country’s largest lender State Bank of India (SBI), HDFC Bank and Kotak Mahindra Bank slashed their home loan rates. And the latest to join the bandwagon, ICICI Bank too has revised its interest rates on Friday, March 5. ICICI, which is the country’s one of the largest private lender, revised its home loan rates to 6.70 per cent, which its lowest in past 10 years.
According to a Financial Express report, the revision by the banks comes after the Reserve Bank of India (RBI) kept the repo rate unchanged at a low of 4 percent. Citing this, several banks have further reduced their home loan interest rates to increase their footprint in the segment. The report also mentioned thatcurrently, there are at least 15 banks that have lowered their home loan interest rates and are offering floating interest rates starting under 7 percent per annum.
The current phase of low rates may look like a prime time for homebuyers to realise their dream of buying their dream houseor a piece of property. However, they need to have requisite margin of funds and meet other mandatory parameters to ensure their home loan burden remains under control and they have the means to clear the loan in time.
Furthermore, potential homebuyers should be wary of these bank loans are tied to the RBIs repo rate and any fluctuation in the key policy would lead to a swift and corresponding hike in their applicable interest rate.
Here’s a list of the lowest advertised interest rates for floating-rate home loans by banks.
Bank Name and theirAdvertised interest rate (in % pa)
- State Bank of India -6.65 % pa
- ICICI Bank -6.70% pa
- HDFC Bank -6.70% pa
- Kotak Mahindra Bank -6.65% pa
- Punjab National Bank -6.80% pa
- Union Bank of India -6.80% pa
- Central Bank -6.85% pa
- Bank of Baroda -6.85% pa
- UCO Bank -6.90% pa
- Canara Bank -6.90% pa
Please note: The figures mentioned above interest rate applicable to an individual could be higher depending on their age, gender, income, credit score, loan amount, property value, and several other terms and conditions laid down by the bank/lender.