Buying a house is one of the key financial decisions that one takes, and is heavily influenced by the buyer’s current income, expectations of his/her future income, financial goals, so on and so forth.
However, before one decides to raise a home loan to buy his own abode, one is expected to compare the interest rates offered by different lenders in order to take a calculated decision. Most banks are currently offering home loans at marginally lower interest rates than the regular ones.
To make your decision become more convenient, we have given an objective comparison of the interest rates charged by different lenders.
These are the interest rates charged by top lenders:
State Bank of India (SBI): The state lender charges an interest rate that varies between 8.6 percent and 9.65 percent based on the applicant’s credit score. The lowest interest rate is 8.6 percent for the borrowers with a credit score of more than 750.
The borrowers with a credit score between 700 and 749 are given loans at an interest rate of 8.7 percent. The borrowers with score of 650 to 699 are offered loans at 9.45 percent and those with score in the range of 550 to 649 can avail home loans at 9.65 percent.
Bank of Baroda (BoB): Bank of Baroda offers home loans to borrowers at an interest rate that varies between 8.40 and 10.60 percent. The exact interest rates are based on loan limit and credit score of applicants. These rates are applicable to both salaried and non-salaried persons.
Punjab National Bank (PNB): The state lender offers home loans at an interest that varies between 8.40 and 10.10 percent per annum. The exact interest rate is based on the LTV (loan to value) ratio, loan amount and credit score. Higher the LTV ratio, higher the interest, and higher the credit score, lower the interest rate.
HDFC Bank: The largest private lender HDFC Bank is offering home loans at special interest rates that vary between 8.50 and 9.15 percent per annum. These rates apply to both salaried and self-employed.
The standard home loan rates for both these categories range between 8.75 percent and 9.40 percent.
ICICI Bank: The private lender offers home loan at an interest rate that varies between 9 and 9.10 percent based on the credit score. The salaried employees are entitled to 9 percent interest rate on their loans and self-employed persons are entitled to 9 percent on credit score of 800 and 9.10 percent on credit score of 750-800.
It is vital to note that these special interest rates are valid only till Dec 31, 2023. The standard interest rates of ICICI Bank range between 9.25 percent and 10.05 percent.
One should weigh a number of pros and cons before zeroing in on a lender for raising a home loan. Although interest rate is key factor to influence your decision, other determinants include amount of processing fee, customer care services post loan disbursal and quality of customer reviews.
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Published: 21 Dec 2023, 06:45 PM IST