What Are The Ideal Home Loan Interest Rates In India?

The ideal, which means the lowest, home loan rates in India start at round 10.10% in today’s market. But, most organizations start their offering from 10.25% as the floating home loan interest rates. The fact is, when the principal amount you borrow for the home loan runs into millions of rupees or even more, even a slightest infraction in these rates can affect your monthly EMIs. However, none of the housing finance companies or banks continue the repayment at the same home loan rates for the entire tenure of 20 to 30 years. The home loan interest rates are certainly going to vary. Though the rates remain within a range of 10.10% to 12% approximately, even a slight change will impact the EMIs.

With due consideration to the variation in interest rates, additional charges over the home loan duration, your actual calculations may come to a much higher amount. So, when you apply to a housing finance company for a home loan, you must choose the EMIs that you can afford to pay and the organization that you can depend upon for a period of 20 to 30 years. This is as crucial a factor as the home loan rates because the organization that facilitates your loan is in a position to offer a top up loan, restructuring, repayment concessions, etc. along with some of the regular home loan services.

Another factor that influences your ideal housing loan interest rates is the prepayment charges. As of today, that difference is zero for the floating type home loan borrowers of today. However, this is a government decision rather than the business decision of the respective organizations. So, this will increase your repayment to the lender considerably if you are a fixed rate home loan customer as the decision for fixed rate customers still lies in the hands of the lending organizations.

When a home loan borrower opts for hybrid home loan rates, there are two different home loan agreements in place that divide the entire principal amount into two parts. Hence, the ideal choice for such home loan borrowers is to make the prepayments over the floating interest home loan as and when possible while keeping the fixed rate home loan repayment steady. This can be a smart repayment strategy as it will lower the home loan tenure for the floating interest home loan considerably. However, even if there is a hike in the rate of interest, it won’t affect your fixed rate repayments immediately. They will be revised when the fixed rates are due for revision.