A Guide To Floating Home Loan Interest Rates At Leading Indian Banks

In the August monetary policy review, the Reserve Bank Of India (RBI) governor Raghuram Rajan left the repo rate (repurchase rate at which the RBI lends to commercial banks) unchanged, at 7.25 per cent. Even though the RBI has cut the repo rate by 75 basis points this year, many analysts claim that the major mortgage lenders did not transfer the benefits to borrowers by the same degree. Most banks slashed their base lending rates by 25-50 basis points.

Currently, the major mortgage lenders in India (SBI, ICICI Bank and HDFC Bank) have a base rate of 9.7 per cent. But, on August 31, HDFC Bank and Canara Bank cut base rates by 35 and 10 basis points respectively. The new rates of HDFC Bank are effective from September 1. However, HDFC's home loan interest rates will remain unchanged, despite the cut in the base rate, though the revision will lead to a drop in equated monthly installments (EMIs) of auto loans, education loans and personal loans for all pro­spective customers. The home loan rates will remain unaffected as HDFC Bank distributes home loans of HDFC, as reported by newspapers. However, as the RBI might cut the repo rate in its monetary policy review on September 29, home loan interest rates are likely to fall further.

If you are a potential home buyer, you would be interested in knowing the lending rates of leading Indian banks when the base rate cut announced August 31 will come into effect. Here is a list of the floating interest rates prevailing at the major banks:

HDFC Bank

Interest Rate: 9.85% to 9.95% 

For women home buyers: 9.85 per cent

For male home buyers: 9.90 per cent

State Bank Of India:

For women home buyers: 9.70 per cent

For others: 9.75 per cent.

ICICI Bank:

Interest Rate: 9.85-10.15 per cent

Up to Rs 5 Crore: 9.85 per cent

Above Rs 5 Crore: 10.10 per cent

Life Insurance Corporation:

Interest Rates: 9.90-10 per cent

Canara Bank

Up to Rs 1 Crore: 9.9 per cent (Was earlier 10 per cent)

Over Rs 1 Crore: 10 per cent (Was earlier 10.10 per cent)

Axis Bank

For salaried borrowers (For all loans): 9.95 per cent to 12.05 per cent

For self-employed borrowers:

Up to Rs 75 lakh: 10.20 per cent

Over Rs 75 lakh: 10.45 per cent

For all top up loans: 12.05 per cent

United Bank Of India:

Irrespective of the amount and loan tenure period: 10 per cent.

Indian Bank:

Up to Rs 75 lakh: 9.95 per cent

Over Rs 75 lakh: 10.20 per cent

Union Bank Of India:

Interest Rate: 10-10.75 per cent