Buying a house? These 6 banks offer lowest home loan interest rates

Most lenders give low-interest loans to individuals with good credit, while those with bad credit are charged a higher interest rate.

Money Poise Money Poise
Oct 30, 2023 - 19:16 Updated: Oct 30, 2023 - 21:27
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Buying a house? These 6 banks offer lowest home loan interest rates
HDFC offers home loans for an interest rate that ranges between 8.5 to 9.4 percent

Obtaining a home loan may prove to be a difficult endeavor. Any sane wealth advisor would encourage you to consider all of your options before settling on the 'correct' lender who can provide you with the greatest price.

Although different banks offer varied interest rates on house loans, borrowers with a good credit score are usually issued loans at a lower interest rate, while those with a low credit score are usually offered loans at a higher interest rate.

Here's a rundown of the house loans available from leading lenders, as well as the interest rates they offer:

State Bank of India: Under a special campaign, the State Bank of India (SBI) is currently offering home loans at rates ranging from 8.6 percent to 9.65 percent per annum.

Borrowers with a CIBIL score of 750 or more are entitled to an 8.6 percent effective rate, while those with a CIBIL score of 700-749 are eligible for an 8.7 percent annual interest rate. This is 55-65 basis points less than the standard rate of interest (known as the card rate). The higher the CIBIL score, the cheaper the interest rate; the lower the score, the higher the interest rate.

Lowest interest rates offered by lenders

Bank                        Lowest Interest rate (%)
State Bank of India                8.6
ICICI Bank                        9.25
HDFC Bank                      8.5
Kotak Mahindra Bank       8.7
Bank of Baroda                          8.4
IDFC First Bank             8.75

(Source: Various bank websites)

ICICI Bank: This private bank provides home loans ranging from 9.25 to 9.65 percent (for salaried individuals) and 9.40 percent to 9.80 percent (for self-employed individuals) for properties costing up to 35 lakh. The interest rate on home loans ranging from 35 to 75 lakh is 9.5-9.8 percent for salaried personnel and 9.65-9.95 percent for self-employed.

For loans over 75 lakh, the interest rate is between 9.6 - 9.9 percent (for salaried personnel) and 9.75 - 10.05 percent (for self-employed individuals).

HDFC Bank: The largest private bank provides home loans at an annual interest rate ranging from 8.75 to 9.40 percent. The special home loan interest rate varies from 8.5 to 9.15 percent.

Kotak Mahindra Bank: This private lender provides house loans with interest rates starting at 8.7 percent for salaried individuals and 8.75 percent for self-employed individuals.

Bank of Baroda: The governmental lender provides home loans at interest rates ranging from 8.4 to 10.60 percent to both salaried and non-salaried individuals.

IDFC First Bank: The private lender provides house loans with interest rates starting at 8.75 percent for salaried people and 8.85 percent for self-employed people.