🏠 Home Loan Eligibility Planner
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🏠 Home Loan EMI Calculator
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| Year | EMI | Principal Paid | Interest Paid | Balance |
|---|
Home loan EMI is indicative. Final EMI may vary due to repo rate changes, reset period, insurance, or bank rounding adjustments.
What is Home Loan (India)?
A home loan is a secured loan given by a bank or housing finance company to help you buy, build, or renovate a house. The bank pays most of the property cost to the seller, and you repay the bank every month in EMI.
The house itself becomes security for the lender. This means until you repay the full loan amount with interest, the lender keeps legal rights on the property. After complete repayment, the property fully becomes yours.
If the borrower stops paying EMIs for a long time, the lender has the legal right to recover the loan amount by selling the property as per banking rules.
10 Important Features of Home Loans in India
1. High Loan Amount
Banks usually finance 75%–90% of the property value. You only arrange the remaining amount.
Banks usually finance 75%–90% of the property value. You only arrange the remaining amount.
2. Very Long Tenure
Home loans can run up to 30 years which makes EMI affordable compared to other loans.
Home loans can run up to 30 years which makes EMI affordable compared to other loans.
3. Lower Interest
Because property is security, interest rates are much lower than personal or credit card loans.
Because property is security, interest rates are much lower than personal or credit card loans.
4. Tax Benefits
Under income tax rules, principal and interest payments can give deductions in the old tax regime.
Under income tax rules, principal and interest payments can give deductions in the old tax regime.
5. No Prepayment Penalty
Most floating-rate home loans allow early repayment without extra charges.
Most floating-rate home loans allow early repayment without extra charges.
6. Fixed or Floating EMI
You can choose stable EMI or rate linked with RBI repo rate.
You can choose stable EMI or rate linked with RBI repo rate.
7. Legal Property Check
The bank verifies documents and property title before approval, helping prevent fraud.
The bank verifies documents and property title before approval, helping prevent fraud.
8. Balance Transfer
You can shift your loan to another bank if they offer a lower interest rate.
You can shift your loan to another bank if they offer a lower interest rate.
9. Top-Up Loan Option
Existing borrowers can take extra loan on the same property at cheaper rates.
Existing borrowers can take extra loan on the same property at cheaper rates.
10. Construction Moratorium
During house construction, banks may allow paying only interest (Pre-EMI).
During house construction, banks may allow paying only interest (Pre-EMI).
Home Loan Interest Rates in India (Fixed vs Floating + History)
Home loan interest rates decide your total cost of house ownership. Even a 0.5% change can increase or decrease your total repayment by lakhs of rupees. In India, banks mainly offer two types of interest rates — Fixed and Floating.
1. Fixed Rate vs Floating Rate
- Fixed Rate: Interest remains constant for the entire tenure. EMI does not change. Good for stability and predictable budgeting.
- Floating Rate: Interest changes with RBI repo rate. EMI or tenure may increase or decrease over time.
- Floating rates usually start cheaper than fixed rates.
- Fixed rates are normally 1%–2.5% higher initially but protect from future rate increases.
- Most Indian borrowers choose floating rate because RBI cuts directly reduce EMI burden.
2. Interest Rate History (2000 – 2026)
| Period | Typical Rate | Market Situation |
|---|---|---|
| 2000 – 2004 | 12% – 14.5% | High inflation and expensive borrowing |
| 2005 – 2010 | 8% – 11% | Economic liberalization & bank competition |
| 2011 – 2015 | 9.5% – 10.5% | Base Rate system era |
| 2016 – 2019 | 8.5% – 9.5% | MCLR introduced |
| 2020 – 2022 | 6.5% – 7.5% | Pandemic low rates |
| 2023 – 2025 | 8.1% – 9.5% | Inflation control & repo hikes |
| 2026 | 7.1% – 8.7% | Stabilized repo-linked loans |
3. How Interest Actually Works (2026)
- Most loans today follow RBI Repo Linked Lending Rate (RLLR).
- Your rate = RBI Repo Rate + Bank Spread (margin).
- If RBI reduces repo rate → EMI decreases.
- If RBI increases repo rate → EMI or tenure increases.
- Banks reset interest every 3 months as per RBI rules.
- No foreclosure charges on floating rate loans.
4. Which Banks Offer Which Rate Type
- SBI – Mostly floating repo linked loans.
- HDFC Bank – Floating + hybrid fixed plans.
- ICICI Bank – Repo linked floating loans.
- Bank of Baroda – Repo linked floating loans.
- Axis Bank – Floating & step-up EMI options.
- LIC Housing Finance – Both fixed and floating.
- Kotak Mahindra Bank – Floating repo based loans.
- Bajaj Housing Finance – Floating with flexible tenure.
Easemoney Tip: For long tenure (20–30 years), floating rate is usually safer. Historically, Indian interest rates move down over long periods. Fixed rate is useful only when you expect interest rates to rise sharply.
Best 10 Options for Home Loan in India (Safe & Good to Go)
A home loan usually runs for 15–30 years, so choosing the right bank matters more than choosing a slightly lower EMI. Below are trusted lenders in India known for stable policies, clear charges and consistent service.
1. State Bank of India (SBI)
Very reliable PSU bank with simple charges and strong approval credibility.
Starting interest: around 7.25% p.a.
2. HDFC Bank
Fast processing and flexible repayment options, popular among salaried borrowers.
Starting interest: ~7.2% – 7.9% p.a.
3. ICICI Bank
Strong digital approval and instant sanction for existing account holders.
Starting interest: ~7.45% p.a.
4. LIC Housing Finance
Highly trusted housing finance company suitable for long-term borrowers.
Starting interest: ~7.15% p.a.
5. Bank of Baroda
Transparent loan structure and good for higher property value loans.
Starting interest: ~7.10% – 7.20% p.a.
6. Axis Bank
Good for salaried professionals and strong credit score profiles.
Starting interest: around 8.0% p.a.
7. Kotak Mahindra Bank
Competitive repo-linked rates and discounted online processing fees.
Starting interest: ~7.7% p.a.
8. Union Bank of India
Often among the lowest entry-level interest rate lenders.
Starting interest: ~7.15% p.a.
9. Bajaj Housing Finance
Fast processing and flexible eligibility for quicker disbursal.
Starting interest: ~7.15% p.a.
10. Tata Capital Housing Finance
Trusted brand with step-up EMI and customized repayment plans.
Starting interest: ~7.5% p.a.
Rates shown are indicative (2026). Actual interest depends on credit score, income, loan amount and property documents. Applicants with CIBIL 750+ usually receive the lowest rates.
Types of Home Loan in India (2026)
Banks in India offer different home loan categories based on the property stage — land purchase, construction, renovation, or refinancing. Choosing the correct type improves approval chances and avoids documentation rejection.
1
Home Purchase Loan
Loan used to buy ready, resale, or under-construction flats or houses. This is the most common loan for first-time buyers.
2
Home Construction Loan
For people who already own a plot and want to build a house. The bank releases money step-by-step based on construction progress.
3
Plot / Land Purchase Loan
Used for buying a residential plot. Most banks require you to start house construction within a few years.
4
Composite Home Loan
Single loan that covers both land purchase and house construction under one EMI and one documentation process.
5
Home Improvement Loan
For repairs, painting, waterproofing, kitchen renovation or remodeling of an existing property.
6
Home Extension Loan
For expanding your home — adding rooms, floor, balcony, or additional structure.
7
Balance Transfer Loan
Move your existing home loan to another bank offering lower interest and reduced EMI.
8
Top-Up Home Loan
Extra loan over your existing home loan for education, marriage, or personal needs at cheaper rates than personal loans.
9
NRI Home Loan
Special loan designed for NRIs and PIOs who want to purchase property in India.
10
Bridge Loan
Short-term loan used when you want to buy a new house but your old property is not yet sold.
Planning to Build Your Own House?
Before taking a construction loan, first calculate real building cost. Many people underestimate and construction stops midway due to fund shortage.
Check Home Construction Cost CalculatorBenefits of Home Loan in India (2026)
A home loan is not just borrowing money. It is a long-term financial arrangement that helps families purchase property without waiting many years to save the full amount. Because it is secured against property, it is safer and cheaper than most other loan types.
Early Home Ownership
You can shift to your own house immediately instead of waiting 10–20 years to save the full property cost.
You can shift to your own house immediately instead of waiting 10–20 years to save the full property cost.
Lower Interest Compared to Other Loans
Home loans usually cost much less than personal loans because the bank has property security.
Home loans usually cost much less than personal loans because the bank has property security.
Tax Saving
Under the old tax regime you can claim deductions on principal and interest every year.
Under the old tax regime you can claim deductions on principal and interest every year.
Balance Transfer Facility
You can move your loan to another bank if they offer a lower rate or better service.
You can move your loan to another bank if they offer a lower rate or better service.
Top-Up Loan Option
Existing borrowers can take extra funds at cheaper rates than a personal loan.
Existing borrowers can take extra funds at cheaper rates than a personal loan.
Long Tenure Flexibility
Repayment period up to 30 years keeps EMI manageable for middle income households.
Repayment period up to 30 years keeps EMI manageable for middle income households.
RBI Customer Protection Rules (Home Loan)
These rules are issued by the Reserve Bank of India to protect borrowers and ensure fair lending:- Banks cannot charge foreclosure or prepayment penalty on floating-rate home loans for individuals.
- Interest rates must be linked to an external benchmark (usually RBI Repo Rate).
- All processing fees, reset period and loan charges must be disclosed before sanction.
- The borrower must receive the loan agreement and full repayment schedule.
Official RBI Reference:
RBI Housing Loan & Customer Awareness Guidelines
News Reference:
Times of India – RBI directive on home loan prepayment charges
RBI Housing Loan & Customer Awareness Guidelines
News Reference:
Times of India – RBI directive on home loan prepayment charges
Easemoney Tip:
One major advantage of a home loan — your EMI can replace your rent. Rent gives zero ownership. Home loan EMI slowly builds property ownership (equity). If possible, choose a slightly shorter tenure. You may pay a little higher EMI now, but you will save many lakhs in total interest.
One major advantage of a home loan — your EMI can replace your rent. Rent gives zero ownership. Home loan EMI slowly builds property ownership (equity). If possible, choose a slightly shorter tenure. You may pay a little higher EMI now, but you will save many lakhs in total interest.
Home Loan Eligibility in India (2026 Guide)
Home loan approval in India depends on your income stability, repayment capacity, credit history and property value. Banks check whether you can safely repay the loan during your working life. The process is rule-based and mostly similar across all major banks and housing finance companies.
1. Basic Eligibility Requirements
- Applicant must be a Resident Indian (special schemes exist for NRIs).
- Minimum age usually 21 years at the time of application.
- Maximum age generally 65–70 years at loan maturity.
- Salaried applicants require stable employment and regular income.
- Self-employed applicants need business continuity (normally 3 years).
2. Income & Salary Requirements
- Salaried: minimum monthly income typically ₹18,000 – ₹25,000 depending on city.
- Self-employed: annual income generally ₹2–3 lakh or more.
- At least 2–3 years of work experience required.
- Income stability matters more than very high salary.
- Adding a co-applicant (spouse/parent) increases eligibility.
3. Credit Score (Most Important Factor)
- 750+ CIBIL score = best interest rate and fast approval.
- 700–749 = normal approval.
- 650–699 = limited approval or higher rate.
- Below 650 = difficult approval in most banks.
- Higher credit score can reduce processing issues.
4. RBI Rules & Lending Limits
- Banks can finance up to 90% of property value for smaller loans.
- 80% funding for mid-value properties and 75% for expensive property.
- No prepayment penalty on floating rate home loans.
- Stamp duty & registration cannot be counted in property value calculation.
- Original property documents must be returned within 30 days after closure.
5. Required Documents
| Category | Salaried | Self-Employed |
|---|---|---|
| KYC | PAN, Aadhaar, Voter ID / Passport | PAN, Aadhaar, Voter ID / Passport |
| Income Proof | 3 months salary slips & Form 16 | ITR for last 2–3 years |
| Bank Statement | 6 months salary account | 6–12 months current account |
| Property Papers | Sale agreement & approved plan | Sale agreement & approved plan |
6. EMI Capacity Rule (FOIR)
- Your total EMI should ideally stay within 40%–50% of monthly income.
- Existing loans (car, personal loan, credit card EMI) reduce eligibility.
- Lower debt = higher loan approval.
- Longer tenure increases eligibility but also increases interest paid.
Home Loan Fees and Charges (India 2026)
In 2026, RBI transparency rules have reduced hidden charges in home loans. However, banks still apply certain processing and service fees. Understanding these charges before applying helps you avoid surprises at the time of disbursement.
1. One-Time Mandatory Charges
- Processing Fee: Usually 0.25% – 1.5% of loan amount.
- GST: 18% GST applicable on bank service charges.
- Legal & Technical Verification: ₹3,000 – ₹10,000 for property verification.
- CERSAI Registration: ₹50 – ₹100 registry charge to prevent duplicate loans.
- MODT / Mortgage Charges: Around 0.1% – 0.5% of loan (state dependent).
2. Charges After Loan Disbursement
- Prepayment Charges: 0% for floating rate home loans (RBI rule).
- Late EMI Penalty: Penal interest charged on overdue EMI.
- Rate Conversion Fee: Charged when switching to lower interest rate.
- ECS/NACH Bounce: ₹300 – ₹750 per bounced EMI.
3. Typical Processing Fees by Major Banks (2026)
| Bank | Processing Fee |
|---|---|
| SBI | ~0.35% (Min ₹2,000 – Max ₹10,000) + GST |
| HDFC Bank | Up to 0.50% (Min ₹3,300) + GST |
| ICICI Bank | 0.50% – 2.00% + GST |
| Axis Bank | Up to 1% + GST |
| Bank of Baroda | ₹8,500 – ₹25,000 + GST |
4. RBI Consumer Protection Rules (Updated)
- Banks must return property documents within 30 days after closure.
- Penalty ₹5,000 per day if bank delays document return.
- No mandatory insurance purchase required from lender.
- No foreclosure charges on floating-rate home loans.
Easemoney Tip: Always ask for a written sanction letter before paying processing fee. Once the loan is rejected, most banks do not refund processing charges.
How to Apply for a Home Loan in India (Step-by-Step Process)
Getting a home loan in India is now mostly digital, but banks still perform verification and property checks for safety. Below is the real process followed by almost all major banks and housing finance companies.
First Check Your Eligibility Before Applying
Many home loans get rejected because borrowers apply without knowing their limit.
Use Easemoney Eligibility Checker to see approval chances and safe loan amount.
Check Eligibility Now
1
Fill the Application Form
Apply online or offline and provide personal, employment, income and property details.
2
Submit Documents
Upload Aadhaar, PAN, income proof, bank statements and property documents (if finalised).
3
Pay Processing Fee
The bank charges a small fee (usually 0.25%–1.5%) to start verification and credit assessment.
4
Bank Interaction
A bank officer contacts you to understand repayment ability and loan requirement.
5
Residence & Office Verification
Bank representative may visit your home or workplace to verify details.
6
Credit Appraisal
Your CIBIL score, existing loans and repayment history are evaluated.
7
Sanction Letter Issued
If approved, bank gives a sanction letter mentioning loan amount, rate and tenure (valid 3–6 months).
8
Legal & Technical Property Check
The bank verifies property ownership and checks construction quality and market value.
9
Loan Agreement Preparation
Final loan documents are prepared and stamped after property clearance.
10
Agreement Signing & EMI Setup
You sign the agreement and set up automatic EMI payment (NACH mandate or ECS).
11
Loan Disbursement
Funds are released. Ready property = full payment. Under-construction = stage-wise payment.
Home Loan Questions People Really Ask
Tap a question to open. More answers available below.
How much EMI for a 20 lakh Home Loan?
At 8.5% interest for 20 years EMI comes near ₹17,356 monthly. For 30 years EMI around ₹15,400 but interest becomes almost ₹17 lakh total. Longer tenure looks easy but costs heavy.
How to reduce a 20 year Home Loan to 10 years?
Increase EMI after salary increment and pay one extra EMI yearly. Even ₹2,000 extra monthly payment can cut 20 year loan near 11 years and save huge interest amount.
Which bank is best to take a Home Loan?
PSU banks like SBI or Bank of Baroda are safer and transparent. Private banks approve faster but paperwork strict and eligibility checking tighter for irregular income borrowers.
How much home loan for ₹70,000 salary?
Banks allow EMI around 50% salary. For ₹70,000 income EMI near ₹35,000 allowed. That gives roughly ₹40–48 lakh loan depending credit score and existing loans.
What is the best time to take a Home Loan?
Best time is when RBI reduces repo rate cycle. Banks cut rates within few months. Also apply after clearing personal loan and improving credit score above 730.
Which home loan is cheapest?
Cheapest means lowest total cost not lowest interest. Check processing fee, reset period and insurance. Many 7.2% loans become costlier than 7.6% loans overall.
What is 5-20-30-40 rule for home loan?
5% savings ready, EMI below 20% income ideally, tenure under 30 years, and keep emergency fund equal four months EMI before applying loan.
Does CIBIL score matter a lot?
Yes below 650 difficult approval. Above 750 best interest rate. Improving score even 30 points can save lakhs interest across loan lifetime.
Can farmer or small business owner get loan?
Yes banks accept bank statements and ITR instead salary slip. Maintain deposits regularly for one year to increase approval chances.
What is PMAY subsidy scheme?
Government gives subsidy up to 6.5% interest benefit credited to loan account. EMI reduces significantly for eligible lower income families.
Can I close home loan early?
Floating rate loans have zero foreclosure charge under RBI rules. Paying extra amount early saves big interest money.
What happens if EMI missed?
Missed EMI reduces credit score and penalty added. Multiple defaults lead legal notice from bank.
Is co-applicant helpful?
Yes combined income increases eligibility and improves approval chances significantly.
Is prepayment better than investment?
If loan interest above 8.5% prepayment gives guaranteed saving equal to interest avoided.
Do banks check property legally?
Yes bank legal team verifies ownership chain and approvals protecting buyers from fraud property.
Safe down payment percentage?
At least 20% property value recommended to reduce EMI burden and rejection risk.