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New Interest Rates For Home loan :

                  The interest rate in regular on home loans is also depends on interest rate period as well.  Home Loan interest rates in particular are dependent on the home loan payment, loan tenure and the profile of the borrower. The borrower’s credit history and score under credit information bureau like CIBIL also has an impact on the home loan interest rate. The home loan interest rates can vary from loan lender to lender. Lenders like SBI offer various home loan interest rate for its new customers against its existing customers.

Best Home Loan Interest Rates

                   Housing Loan interest rates can primarily be divided into two categories (a) fixed rate and (b) floating rate of interest. There are very few lenders in India who offer pure fixed home loan rates where the interest rate remains constant for the entire tenure of the home loan, while most lenders have a reset period of 3-5 years. In floating home type, the interest rate on such loans  is subject to change whatever there are changes in the repurchase agreement  rates announced by RBI or any change is there in rate of the bank.  Borrower should possibilities for fixed rate of interest. If he is certain that the interest rate is the lowest in the interest cycle.  HDFC home loan interest rate is fixed for the entire tenure of loan, whereas SBI home loan interest rate is floating.

Lenders even offer hybrid home loan lowest interest rates. In recent times, some lenders have come up with advance home loan products like teaser / dual rate of interest where the interest rate on such loans remains fixed for initial 1-5 years and thereafter it automatically moves to a normal floating rate of interest.

               In case when the borrower prepayment the housing loan taken under floating rate of interest, the lender cannot impose any penalty for prepayment of such loan as per the terms & conditions issued by RBI and National Housing Bank (NHB). The borrower can effort an option of converting from fixed interest rate to floating interest rate and vice versa by without paying any penalty or  fee

The home loan interest rate for banks is expressed as certain point above Base Rate and certain point above or below Prime Lending Rate  popularly known as spread.

            The banks follow base rate system for calculating their interest rate, whereas the housing finance companies like HDFC Bank, LIC housing finance, etc. follow PLR system

The bank cannot lend below its percentage to any borrower. Any reduction in Base Rates automatically benefits all existing borrowers of the bank in their home loan interest rate. No such constraint exist for the HFC’s and hence banks that follow the Base rate systems are likely to be forced to pass on the benefits of decrease in rates to its existing customers whereas no such system exists for Housing Finance Companies. The benefit, which has a certain degree of ambiguity in the Prime Lending Rate system, happens with a greater degree of clarity in the Base Rate system.