If you’re looking for a variable rate home loan, here are the interest rates currently offered by banks and HFCs across the country.
The Covid-19 pandemic has dealt a heavy blow to the Indian economy, as a result of which the Reserve Bank of India was forced to cut the repo rate to stimulate lending and demand. This has led to banks lowering interest rates on repo-linked home loans while some housing finance companies have also cut rates on their prime lending to provide competitive alternatives.
In fact, while many banks were offering MCLR-linked home loans from 8.8% per annum as of February 2019, there are currently as many as 13 banks and 4 housing finance companies offering home loans from less than 7% per year. time for those looking to buy a home or make enough partial payments to reduce their loan burden. However, before you finalize your decision, check your credit score to see if it is above 750-800 to get the best possible rates and also make sure you have the necessary cash margin and stable income to be able to pay off your loan on time, according to BankBazaar. .
Note that only banks offer variable rate mortgage loans linked to an external reference such as the repo rate, while loans offered by housing finance companies are referenced in relation to their prime rate. If you are considering taking a loan from a bank, make sure that your credit score remains high for the duration of the loan, as any drastic drop could increase the risk margin and lead to an increase in EMIs. Also understand that the EMIs of pension linked loans will experience an immediate and proportionate jump whenever the central bank decides to raise the policy rate. As such, you may also want to make as many partial repayments as possible when rates are low to get out of debt faster.
You can also apply for a home loan from an HFC if your loan amount requirement is high. HFCs, which specialize in different mortgage loan products, are also known to have relatively relaxed standards when it comes to a borrower’s credit rating and often involve hassle-free paperwork. And although their interest rates are generally higher than those offered by banks, the difference between the lowest mortgage interest rate offered by a bank and an HFC has narrowed to just 15 basis points. , according to BankBazaar.
So, if you are looking for a variable rate home loan, here are the interest rates currently offered by banks and HFCs across the country. Compare your options and choose the one that best meets your needs. Note that the interest rate applicable to you will be determined based on your age, gender, income, credit rating, loan size, property size, or any other condition stated by your lender.
Interest rates on variable rate home loans by banks and HFCs
Disclaimer: Data taken from respective bank websites as of December 11, 2020. The list is not exhaustive. Data compiled by BankBazaar.com
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