Compare and choose: A home loan guide for 2015

Chocolate bungalows in nursery rhymes to the Bollywood style pyara ek bangla ho, homes have been a part of everybody's dream. In our effort to make this dream chasing a tad bit easier, we bring you a ready comparison guide for home loans.

Photograph: William Cho/Creative Commons

As soon as one starts looking out for property to buy a house, banks start offering home loans. This can be overwhelming at times. Making a choice then, largely depends on comparing what competitor banks have to offer. We decided to do the hard work so that the comparison task becomes a cake walk and you move one step closer to having your dream home.

For a loan amount up to Rs 30 lakh and the tenure being 15-20 years, the following is on offering.

Floating interest rate: 10.15 per cent

This rate is being offered by the following lenders:

1. SBI (State Bank of India)

2. ICICI Bank

3. HDFC Bank

4. HSBC Bank

5. Axis Bank

6. PNB Housing Finance

7. DHFL

8. India Bulls (Up to Rs 25 lakh)

9. Citi Bank

10. Tata Capital Housing Finance Ltd

EMI per lakh works out to be Rs 975.

SBI charges a processing fee of 0.25 per cent of the loan amount up to Rs 25 lakh or minimum Rs 1000. For a loan amount above Rs 25 lakh the processing fee is Rs 3,250. Citibank charges 0.25 per cent of the loan amount. ICICI, HDFC and PNB charge 0.5 per cent of the loan amount as processing fees.

However, HDFC has capped the maximum amount to Rs 10,000. Whereas, Axis Bank and HSBC charge a minimum processing fee of Rs 10,000 or 1 per cent of the total loan amount. DHFL charges Rs 5000 plus document charges and taxes and India Bulls charges Rs 7,500 plus taxes.

Floating interest rate: 10.20 per cent

This rate is being offered by the following lenders:

1. Federal Bank

2. Bank of India

3. UCO Bank

4. Canara Bank

The EMI per lakh works out to be Rs 978.

Federal Bank and UCO Bank both charge 0.5 per cent of the loan amount. The minimum amount charged is Rs 3000 and Rs 1500 whereas maximum is Rs 7500 and Rs 15,000 respectively by both the banks. Bank of India has decided to waive off processing fees on new loans sanctioned up to March 2015.

Floating interest rate: 10.25 per cent

This rate is being offered by the following lenders:

1. IDBI

2. Punjab National Bank

3. Allahabad Bank

4. Central Bank of India

5. Corporation Bank

6. Union Bank of India

7. United Bank of India

8. Bank of Baroda

9. Oriental Bank of Commerce

10. Kotak Mahindra Bank

11. Dena Bank

12. First Blue Home Finance

13. Syndicate Bank

14. Indian Overseas Bank

15. State Bank of Travancore

16. Indian Bank

The EMI per lakh works out to be Rs 982.

IDBI, Punjab National Bank and Oriental Bank of Commerce have NIL processing fees. State Bank of Travancore does not charge any processing fee up to a loan amount of Rs 25,000 and United Bank of India has waived off processing fee for a loan amount up to Rs 75 lakh. Processing fee ranges from 0.25 per cent to 0.5 per cent of the loan amount.

Allahabad Bank charges 0.6 per cent of the loan amount with a cap of Rs 12,000 while India Overseas Bank charges 0.58 per cent of the loan amount with a cap of Rs 10,190.

Floating Interest Rate: 10.26 per cent-10.30 per cent

Standard Chartered Bank offers 10.26 per cent on home loans with a processing fee of Rs 5500 plus service tax. The EMI works out to be Rs 982.

Vijaya Bank charges 10.30 per cent and the EMI works out to be Rs 985. The processing fee is 0.25 per cent of the loan amount with a cap of Rs 10,000.

Floating interest rate: 10.50 per cent and above

1. Deutsche Bank offers an interest rate of 10.5 per cent and a flat processing fee of Rs 12,000 plus taxes. EMI per lakh works out to be Rs 998.

2. Bank of Maharashtra offers 10.55 per cent (up to 25 lakh) and 10.75 per cent above that. Accordingly the EMI works out to be Rs 1001 and Rs 1015 respectively. Processing fee is 0.25 per cent of the loan amount subject to maximum of Rs 25,000.

3. ING Vysya offers 10.75 per cent, the EMI for which works out to Rs 1015. Processing fee is 0.5 per cent of the loan amount.

4. Development Credit Bank and Dhanalakshmi Bank offer 11.50 per cent and charge a processing fee of 1 per cent. EMI per lakh works out to be Rs 1066.

Fixed rates on offer

1. LIC Housing Finance offers 10.10 per cent (fixed for 2 years)

2. HDFC Ltd offers 10.15 per cent-10.65 per cent (fixed for 2-3 years) and 10.25 per cent-10.75 per cent (fixed for 10 years).

3. Axis Bank offers 10.40 per cent (fixed for 20 years)

Look out for festive offers when processing fee is waived off and always negotiate for better rates. Request your bank official to share complete details so that there are no surprises in the form of hidden charges, pre-payment charges etc.

Also, find out about special rates applicable for self-employed individuals and women.

Hope this compilation helps you in analysing what suits you best. Wishing you good luck and happy homes!

The author is a credit expert with 10 years of experience in personal finance and consumer banking industry and another 7 years in credit bureau sector. Rajiv was instrumental in setting up India's first credit bureau, Credit Information Bureau (India) Limited (CIBIL). He has also worked with Citibank, Canara Bank, HDFC Bank, IDBI Bank and Experian in various capacities.