There was a time when taking home loans meant one needs to tick yes to at least one of the following checklists:
- ample savings in the bank account
- sufficient amount in the provident fund
- and/or depend on retirement benefits
simply because the concept of ‘home loan’ didn’t evolve until 1970.
Brief History
Eventually, the home loan sector started taking its course with HDFC bank becoming the first player in the segment. The first borrower to take home loan was Mr D. B. Remedios, who borrowed Rs. 30,000 from the bank for the construction of his house, back in 1978.
Home Loan Market in Today’s Time
In today’s time, a home loan is a convenient option for buyers who are enthused with a vigour to own personal property and have a decent monthly disposable income. The repaying policy is even simpler, thanks to the equated monthly instalment [EMI] system. With this system in place, he/she can repay the loan in instalments every month within a stipulated tenure.
These days the leading banks allow borrowers to take home loan as much as 80 – 90% of the property price (Source: Economic Times 2018) in exchange for the below-mentioned interest rates.
Home Loan Interest Rates in 2019*
For your comprehensive understanding and knowledge, we have sighted out the names, interest rates and the processing fees of top 10 banks. They read as follows:
Home Loan Provider | Home Loan Interest Rates | Home Loan Processing Fees |
YES BANK | 9.35% onwards | 0.5% of loan amt. or Rs. 10,000 whichever is higher (+GST) |
SBI | 8.75% onwards | Rs. 0 – 10,000 |
HDFC Bank | 8.85% onwards | Up to 0.5% of loan amt |
ICICI Bank | 8.95% onwards | 0.5% – 1.00% of loan amt. |
IDFC Bank | 8.90% onwards | Rs 10000 |
Indiabulls | 8.80% onwards | Up to 1% of loan amt |
LIC Housing Finance | 8.70% onwards | For up to 1 Cr – Rs 5000, Above 1 Cr Rs 10,000 |
PNB Housing Finance | 9.05% onwards | Up to 1% of loan amt |
DHFL | 10.00% onwards | Up to 1% of loan amt |
Axis Bank | 8.85% onwards | Up to 1% of loan amt |
IDBI Bank | 8.70% onwards | 0.5% of the loan amount |
Tata Capital | 8.80% onwards | 0.2% of loan amt. |
Punjab National Bank | 9.05% onwards | Nil |
Bank of India | 8.70% onwards | Min. 1000 and Max. Rs. 20,000 |
Syndicate Bank | 9.85% onwards | Min. 500 to Max. 5,000 |
Canara Bank | 8.75% onwards | Varies based on applicant profile |
United Bank of India | 8.65% onwards | Varies based on applicant profile |
IIFL | 9.50% onwards | 0.75% of the loan amount (minimum Rs. 5,000) |
*Reference: mymoneymantra (2019), myloancare (2019), housing.com (2019)
Concession for women
Did you know that many banks like HDFC, ICICI and SBI offer concession on interest rate and stamp duty to women? So, if the property is in a woman’s name then banks waive off around 1% – 2% (Source: Housing.com 2019) on the stamp duty. Also, if the property is in joint ownership with the wife, then both the husband and the wife can individually apply for an exemption. But in this case, the wife needs to have a separate and genuine source of income. (Source: Housing.com 2019)
Era of digitization
Gone are the days when one needed to be physically available at the banks to complete the loan process. But with the advent of digitization one can get through the process at his/her fingertips. Banks hire executives who will be at your doorstep to help you complete the process.
Time to Switch
So, if you’ve been living as a tenant for too long and want to move to your personal house then switching to your personal house is no longer a stressful matter. All it takes is the right decision, taken at the right time!
