Cheapest Home Loans in 2025: Best Interest Rates from Top Banks
| Feb 19, 2025, 19:00 IST
If you're planning to buy a home and looking for an affordable home loan, now might be the perfect time. After the Reserve Bank of India (RBI) reduced the repo rate, several banks have lowered their home loan interest rates. However, factors such as credit score, repayment history, and financial stability play a significant role in loan approval and interest rates.
Top 5 Banks Offering the Lowest Home Loan Interest Rates
Here are the banks offering the most affordable home loans in 2025:
| Bank Name | Starting Interest Rate |
|---|---|
| Union Bank of India | 8.10% |
| Bank of Maharashtra | 8.10% |
| Bank of Baroda | 8.15% |
| Punjab National Bank (PNB) | 8.15% |
| State Bank of India (SBI) | 8.25% |
Processing Fees for Home Loans
Most banks charge a processing fee for home loans, which may be:
- A percentage of the loan amount (varies by bank).
- A fixed fee, regardless of loan size.
- Zero processing fee (offered by some banks as a special scheme).
To get the best deal, check with your bank about any additional charges before applying.
Factors That Affect Your Home Loan Interest Rate
- Credit Score – A higher credit score (750+) can get you better rates.
- Loan Amount & Tenure – Interest rates may vary based on the loan amount and repayment period.
- Employment & Income Stability – A stable job or high income improves loan eligibility.
- Bank’s Policy & Offers – Some banks offer lower rates for specific customers (e.g., women, government employees).
If you're planning to buy a home soon, compare these rates and choose the best home loan that suits your needs.
