Which is the best bank for Home Loan ?

POSTED BY Jagoinvestor ON May 21, 2012 COMMENTS (698)

Taking a Home loan is a big task in itself and one of the biggest financial decisions. A home loan is the longest debt in our life. At times 10-20 yrs, which makes demands a long term commitment. Each month you have to pay your EMI, sometimes you have to prepay some part of home loan, sometimes you need some documents and visit the bank. There are numerous things to be done during taking the home loan and after taking the home loan, hence you should be very clear that which is the best bank for Home Loan. Without much confusion, it’s very clear that everyone wants to go with the bank which makes your life easy at the time of taking a home loan and even after that. So the biggest question on everyone’s mind is “Which is the best bank for a Home loan?”

Best Home Loan Bank in India

First thing first, you have to be very very clear that their cant is a single bank or loan institution which is perfect for everything and you will never face any issue with them. Also, there is no “best bank for Home Loan” which has always worked for everyone to date. But overall we can always pick some banks which have been better than others on different parameters. You can say that on a high level “Bank A” is better than “Bank B” and this is based on many loan takers’ experience over the years. So now in this article, we will try to understand the difference between different banks and how they differ with each other. We will also see a survey result done with the vast community of this blog and which bank they choose collectively as the best bank for a home loan.

Public Companies vs Pvt Companies

While researching on this topic, the first thing which came to my mind was “all banks are the same, everyone has a bad experience will all kinds of banks, whether PSU or private”. But we have to understand that while some people can have a bad experience with some banks, there are a positive experiences too and we have to see things from a very high level and not judge a bank just based on a handful of bad experiences. The first confusion which comes to any loan taker mind is “PSU bank or private bank?” and based on the experience here is the conclusion.

PSU Banks are good post-loan but not friendly at the time of taking the loan

Private banks are very fast and friendly at the time of disbursing the home loan, they will treat you like a king up-till the loan is disbursed, but once every formality is complete and your home loan is sanctioned, you are a trash to them! As they are extremely aggressive in the marketing of home loans, a lot of people fall for it, Private companies presentation and the way they approach you is good but only till you are not a home loan customer. A lot of times private companies make things easy for you and also bend some rules for home loans. the number of documents they need also is less compared to a PSU bank.

On the other hand, PSU banks are not that great at the start of home loan , their rules are very strict and stringent and they still operate  in the “sarkari” style, however, once your loan process is complete and things start, their afterlife is much easier compared to private banks. The overall handling is much professional and as per the process. In short, they don’t suck your blood every now and then as private companies do.

Private banks are first to raise the interest rates

On the interest rates increase and reduction side, its seen that private companies are first to raise the interest rates after the rate increase from the RBI side, but private banks hide somewhere when there is a time for reducing the interest rates. However, PSU banks are more transparent on this front and much less annoying than Private banks. Also private banks arbitrarily increase the pre-payment charges (  like from 2% to 3%) the conversion fees are also charged heavily if you want to move down to lower interest rates.

Also the changes of fraud at employees level in Private bank is much higher than PSU Banks. I can’t say that PSU banks are not into the bad game, but it’s much much higher in Private banks because of sales pressure and targets. There has been cases of forced selling of home insurance and also cross selling of ULIP’s and other financial products along with the home loan

Which is the best bank for Home loan in India?

Now there are millions of people who have taken home loan and there are various parameters on which a bank can be ranked like Processing time for a home loan, Transparency in whole process, Attitude towards the customer, Interest rates and pre-payment charges, online tracking of your home loan after disbursement. But there is no ranking of banks on all these parameters. However still you can rank a bank overall as good or bad in total. I ran a survey on this blog and got around 1504 participants to vote for the best bank for home loans and based on that we can judge which banks are more preferable and more trusted. Here are the results.

Best Bank for Home Loan in India (Survey Results)

Best Bank for Home Loan in India - SBI , HDFC or LIC

A good place to look for all the home loan related data (Click here)

Top 5 banks for Home Loan at the moment

If you see the survey above, you can clearly see that the top 5 banks for a home loan are SBI, HDFC, LIC Housing, Axis Bank and ICICI Bank and these 5 banks comprise 83% votes. While a big reason for this can be that these are big banks having a wide reach and has more customers and hence the results are a little biased. But at least you can see that out of 1504 people on this blog, 83% of them have a home loan from these 5 big banks, in which SBI tops the list.

1. SBI Bank

Based on the survey and overall reading’s done over the net and comments section of this blog. SBI bank seems to be the best bank for Home Loan. While SBI Bank still carries the hangover of Sarkari culture and they are strict in the overall process, which means you will have to run all over the bank and many times to get things done, but once the whole process is complete, maybe you will have a smooth experience overall. Things will be easy post home loan process if you need anythings from bank compared to other banks. For those who want to know why SBI is preferred, follow this thread

2. HDFC Bank

Overall HDFC bank seems to be have mixed reviews. Some people had a great experience and some had a very bad experience. HDFC Bank is overall recognized as the bank for the home loan itself. But overall the experience was very very mixed.

3. LIC Housing Finance

LIC housing finance seems to be a decent option after SBI. While they are not that great as SBI, still they seem to be a good choice after HDFC and ICICI bank. LIC Housing Finance has lesser documentation requirements, but one has to run around for smaller details.  LIC seems to offer better rates and also giving the option to fix the interest rate for 5 years. One thing which many people do not know is that LIC reduces the interest rates for home loan for its customers having any insurance/investment policy with LIC by at least 0.25 %, but only if Sum assured of all policies collectively is more than 15,00,000 and all policies should be under the name of the loan applicant.

4. ICICI Bank

ICICI Bank seems to be very very fast and too friendly at the time of loan processing, but once the loan is done, life seems to be hell for most of the people. They are not very supportive most of the times and one gets too frustrated with their attitude. Overall their interest rates are also very high.

5. Axis Bank

Axis Bank is another good option as a big bank. One good thing about Axis bank is that they have NIL charges for any pre-payment. It’s a big surprise that Axis bank was more preferred than ICICI bank overall in the survey. While Axis Bank has few good options, there was one recent case from axis bank which I had highlighted on this blog on how they forced sell a life insurance policy along with home loan, While this was a negative thing from Axis Bank,  we have to understand that good and bad experience are part of all the banks.

So what is the final answer ?

While there are positive and negative experiences from different banks, the clear answer coming out of different comments from readers and survey is that if one has to choose just one name, SBI bank is the best bank for home loans. We have seen most of the votes going to SBI Bank and all the pointers are suggesting that its the right choice.

Which bank do you have home loan with and what was your experience overall from start till the end. Can you share it in for others benefit?

698 replies on this article “Which is the best bank for Home Loan ?”

  1. AkshayDeshmukh says:

    Hello Sir,

    Thanks for your article. I have taken home loan of Rs. 37L from IDBI bank in last year. Current ROI is 9.6%. However now, I need top up loan But IDBI rejected saying property valuation is not meeting the criteria. LICHFL has offered me Home + Top up @9.5. Transfer would take at least Rs. 17000/-says’ LIC personnel.

    Should I transfer home loan to LIC? Please advice as none of my friend or acquaintances have taken loan from LICHFL yet and I really need topup.


  2. sachin says:

    Hello Sir,
    I have option from HDFC HFL (9.4%), PNB HFL (9.55%) and PSU banks ranging rate from 9.65%-9.75%. Out of all which option I should opt. Please guide as I am very confused due to interest rate and loan provider past history.

  3. Ragu says:

    Hi Manish,

    Currently i am paying 9.7% and for new loans only bank is offering at 9.4%. Can a bank give different interest to customers for home loan? I gave a letter to the bank. But no response. my loan’s remaining principle and tenure is 27L and 18years. can i switch to some other bank.

    Please suggest.


    1. satishkumar says:

      Dear sir, I m planning for a home loan.plz tell me from which should I loan axis or HDFC? Reply on satishgdhaday@gmail.com

  4. Vandana says:

    Dear Mr.Manish,
    I liked your comments but I have certain doubts regarding hoam loan. It would be nice if you could opine.
    Should i take a loan from HDFC or PNB Housing finance—
    1)HDFC charges a mortgage of 0.5% of the loan amount (Andhra Pradesh govt norms)(Eg: 40,000for a 80lakh loan) BUT PNB housing doesnt charge the 0.5% and not even later ones the agreement is done and amount disbursed ,so I straight away save that 40,000
    2) HDFC rate of interest 9.4% floating and PNB 9.45% floating (They are willing to give it for 9.45 from their actual rate of 9.55%) and they(PNB) say that the discount remains till the loan tenure
    3) Changes of rate of interest is more with PNB 0.25% but Rs.2000+ ST with HDFC
    What the PNB people are telling me that even though the difference in EMI is Rs.250 per month between the two and Rs.3000per year still its Rs.30,000 in ten years time and the initial money saved of Rs.40,000 to start with if we calculate the interest then its a big money.
    4) Nil processing fees for both
    I am confused. Because normally HDFC and SBI are the first banks to change the interest rate be it up or down. If we do a cost benefit analysis which one is beneficial , whether HDFC or PNB housing finance?
    I am old by the HDFC people that there are major service elements and benefits with HDFC and the loan against property at a lower ROI for existing customers at a later date if in future loan is required.

    1. Can you please ask your query briefly.

      We get too many comments and hence cant answer such a long queries due to less man power


  5. Jay says:

    Hi Manish,
    I follow Jagoinvestor site for many of my concerns and Thanks for sharing yours information with us.
    Best bank home loan article looks to be quite old, could you please share the current recommended banks ( nationalized and private) for an home loan. I heard that SBI takes long time in processing and they are restrict and reject loan if the property is having deviations from the plan . Pls recommend your options.

    1. That would mean doing a fresh long survey 🙂 . Not a easy task as of now !

      1. Jay says:

        Manish- I know survey is huge effort, atleast can you recommend the best banks today for home loan. Thanks in advance

        1. I am actually not aware of it . My personal experience is with HDFC and I am very happy with it !

  6. Kalyani says:

    Hi Manish,
    I read your articles often. Jagoinvestor is the first place I think of for any questions regarding investments. Thanks for providing information to many of us.
    This time I am checking your portal for information on how to put a check to the ‘harassment’ of housing loan providers. I have mine with LICHFL. I have some thoughts or feedback which I would like to share with you. Not sure if any others have felt these as issues ever.
    a) They lack the system of communicating customers about a change in interest rate which obviously impacts the outstanding loan repayment schedule. I call this as irresponsibility. (my ROI was changed from 10.25 to 11.7 and no communication sent. I realized it very late.
    When I visited the so called head office in Hyderabad(Madhapur, krishe saphire) I got a response that ‘we might have posted those letters, and that might have got missed somewhere’. When I asked about why you cannot email such communications, I got a response from the same branch manager that I can write feedback on their portal and she cannot do anything about it.
    Is there a way to get LICHFL top management hear this feedback about their poor (and intentional) communication and ill treatment of customers? I did write to the email addresses mentioned, but never got a response.
    b) Their customer portal never allows a complaint successfully posted. I tried it multiple times, while I sent email to the mail ids provided in the portal in April and have not seen a response till now.
    c) They have an offer of reducing loan Rate of interest by paying 1145 /- + taxes extra. This was again not communicated. Is this done by all firms? What does prevailing laws say about this way of increasing and reducing after some payment?
    d) I made a part payment through Cheque in May and I did not receive any communication again about the impact of that pre payment to the tenure. I visited a nearby branch today and they suggested I visit head branch to get this info and that they dont have access to these details. Strangely, same branch collected my pre-payment cheque!!
    It feels as if their attitude is “you BORROWED and so you deserve this kind of empathy from us.” did you hear any such concerns from anyone?
    I am willing to fight to get these corrected. I just dont know how to do that or if someone already doing that. I suspect this is the case with other similar firms?
    This is lengthy, apologies. I am trying to reach you and ok if this is not shown on the website.


    1. You should first complain to bank in this and reach out to banking ombudsman using this platform https://secweb.rbi.org.in/BO/precompltindex.htm

    2. Samir says:

      I have taken a loan from Lichfl and suffering..it looks like new customers don’t get the advantage of rate cut by rbi. For everything you need to go to their branch personally. Nobody attends the phone and this is the condition of Fort branch in Mumbai..sorry state

  7. Vijay says:

    This seems to be old review. . .I just spoke to ICICI guy, he quoted lowest interest rate in market for balance tranfer @9.45% and 9.55% for top up amount. No prepayment charges after 1st EMI and no hidden charges ? Can you help me should i move from SBI to ICICI as I need top up loan and SBI wont give me till Dec 2016 as my other top up is working since Dec 2015.

  8. sudheer says:

    Hi Sanjay Prasad,

    have u bought the flat in secunderabad?

  9. shilpa says:


    We approached SBI with the required documents.
    All our documents regarding the builder and seller was accepted by SBI,but they rejected one agreement called Tri party assignment agreement,made between builder seller and buyer,they said either builder should sell us the flat directly or the flat should get solely registered in the sellers name.
    Since SBI confirmed all other papers are clear except for this agreement they said to approach other banks like icici.
    and once registration is done and property is solely in our name they said they can transfer loan from icici to sbi.

    Kindly advice if this kind of assignment agreement is usual,and wont create any trouble after its registered in our name solely.
    Also which bank is better icici,hdfc,or axis interms of customer service/behavior after loan is disbursed etc.


    1. This looks good. Each bank has their own process and they are right if they want to follow this. Better apply for loan with ICICI and then transfer it later !

  10. bhavin says:

    I am salaried person having all documents to process for Home loan with SBI /HDFC .
    The property which i am looking also approved by both banks .

    Rate of interest for both banks same . ( HDFC expected reduce to 9.4 %)
    Process charges for SBI is ~ 15 K more than HDFC ( one time)
    In long run which bank is better for Home loan .

    1. Hi Bhavin

      SBI / HDFC are top rated organisations for loans. I think you should check your options here


  11. SanjayPrasad says:

    Hi Manish,

    This is Sanjay. I am working in PSU. I am 31, married and having one-year old baby. I am planning to purchase a 10-year old triple bed room flat in Secunderabad which is presently financed by Axis bank. The deal settled for 21 Lacs. I am very much confused about Home Loan. Some banks (Canara) are calculating eligibility based on Gross Income which is around 51K offering full loan (but has processing fee) whereas some banks (SBI, Axis) calculating eligibility based on my “take home pay” which is 33K and offering lesser than expected without processing fee. I do not have any existing loans with banks. I have internal loans taken within our company for which deduction is around 6000. I have pending EMIs and Credit Card bill not more than 10K which can be cleared in 2-3 months. My CIBIL score is 795 as per SBH enquiry. Our PSU is having MoU with Union Bank which is offering 9.65% without processing fee. SBI and few PSU bank staff is so reluctant to give clear information.

    I would like to know,

    What is the exact procedure banks (especially PSU banks) should follow to calculate eligibility.?

    Which bank/housing fin. should I opt.? Being a PSU employee myself, I prefer PSU bank. Is it a good decision to go with UBI as we have MoU or Axis Bank as the original documents and loan of the present owner is with them.?

    How long should be the tenure period (15, 20, 25, 30 yrs.)? What critiria should I follow to decide the tenure period for Tax saving etc.?

    Is it worth to buy a 10-year old flat or shall I go for new flat or independent house.? Some people telling me that there won’t be much resale value for a 10-year old flat in future.

    Please give me suggestions. This is first purchase.

    Thank you.

    1. There is no standard defined process. How does it matter to you? Take it from the bank from where you are getting the loan you require . You can opt for a 20 yrs old loan or 15 yrs if possible, but surely not a 30 yrs old !

      You can go for a 10 yrs flat/villa if its in good condition. I cant comment much on that!

      1. SanjayPrasad says:

        Thanks for the info Manish.

        I am concerned about procedure because I feel that PSU banks should be transparent, shouldn’t they.? And, there is a difference between the interest rates and obviously any one prefer to go for the one which has lowest interest for loans and highest interest for deposits.

        1. All the institutions (private or PSU) should be transparent. You should check each bank and see which one is offering the lowest rate to you

          1. SnehalGaikwad says:

            Need help for home loan on resale flat

  12. ankur says:

    Hi manish,

    I have running loan from LIC for which 2 years lockin period is finishing in next two months. My problem is I need another 7-8 Lac loan for builders demand of registration, VAT and others. Now LIC wont give me repair top-up loan so for that i need to transfer my loan to another bank. Plz suggest which is a good bank to take loan and who can support me with this extra demand. Another thing to my surprise is that LIC floating rate after lockin would be around 11 whereas currently rates are much lesser around 9.5. LIC guys told me that they follow LHPLR which is always higher and doesnt change easily like base rates.Plz help to understand this issue of difference in rates.

    1. You cant always get the extra loan. May be you are not eligible for any further loan , thats why you are not getting it !

  13. kns says:

    Hi Manish ,thanks for 2 very good books on investment from you.
    i have one query and if you can help me, I m planing to buy plot for around 8 lacks. I already have home loan of 20L from sbi , how about getting a topup loan and invest in land, is it good option to use topup loan , as i already have home loan.
    can u please suggest. ? I can afford topup loan along with home loan.


    1. Yes, I think its a good idea, better to take top up loan which will give you loan at lowest interest possible !

  14. Sneha says:


    I like your information which you share with us , I also read this similar tutorial from another platform I think from this post user’s can more details about :

  15. Mahesh says:

    We are looking for a pre-approved home loan and are confused between Canfin Home Loans Ltd which sponsorship of Canara Bank & Axis Banks. . And Can Fin Intrest Rate stat 9.95% to 11.25% & Axis Start at 9.5% to 9.65% Can you please let us know according to you which bank would be better for a home loan considering all the parameters?

    1. Mahesh says:

      Hi Manish,

      We are looking for a pre-approved home loan and are confused between Canfin Home Loans Ltd which sponsorship of Canara Bank & Axis Banks. . And Can Fin Intrest Rate stat 9.95% to 11.25% & Axis Start at 9.5% to 9.65% Can you please let us know according to you which bank would be better for a home loan considering all the parameters?

      An my salary account is Axis banl only kindly confirm which is best?

      1. I think we will not be able to comment on that

  16. Lokesh says:

    Hi Manish,

    Thanks for the post, It was very intuitive.
    I am looking to purchase an apartment on second sale, which is 3 years old.Currently the owner has a loan running in LIC for 21.5 lakhs. I am confused on whether to transfer the loan to my name in LIC itself or taking an loan amount of 20 lakhs in SBI. Please help me on this.


    1. I suggest taking up a topup loan for your requirement from the same lender

  17. Dhans says:

    Hi Manish,

    We are looking for a pre-approved home loan and are confused between HDFC & Axis Banks. HDFC is providing ROI as 9.50% (Base rate=9.30% + Markup = 0.20%) whereas Axis too as 9.50% (Base Rate=9.50% + fixed mark up of 0%). The processing fees for HDFC is around 10K, whereas for Axis it’s around 5K. Rest of the charges remain same.. Can you please let us know according to you which bank would be better for a home loan considering all the parameters?

    1. Hi Dhans

      I am not sure if there is a straight answer to that. HDFC is pretty known in home loans, so I would go with that option !

      1. Dhans says:

        Thanks for the suggestion Manish.

  18. Bhuwan says:

    Hi Manish,

    I want to know which one is the best option for Home Loan i.e. Axis Bank or DHFL

    I am a salaried person & need to get the loan proceed as soon as possible at the lowest interest rate & processing fee.


    1. I would choose Axis ..

  19. kishore says:

    Hi manish,

    What is mean by LHPLR In LIC Housing Finance?
    They are saying Fixed for 2 year 9.60. After that as for LHPLR and current LHPLR=14.20.
    Is this mean after 2 years Interest rate 14.20? totally I am in confusion please explain me.
    Shall I take home lone with LICHF?


    1. Ajay says:

      When going for home loan fixed ROI or floating ROI is better and why?

    2. Hi kishore

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that


  20. Anonymous says:

    HDfc bank home loan process is torture. Their agents know nothing. Instead of making the process easy, they just make it frustrating. Everytime they keep asking for either same documents which already provided or some silly documents which is irrelevant for applying for home loan.
    Either the whole bank needs to change their process or the agent that I was dealing with was a nutcase.
    So to summarize, I am never going to recommend HDFC to anyone ever

  21. GIREESH says:


    1. THey are not the specialist for home loan !

  22. Kamal Pahuja says:

    Greetings, I have taken a home loan from LIC. For first 3 years it was 8.95 fixed for me. But after completing the 3 years, they increased the roi to 11.75%, due to this my emi and Loan tenure was increased. I went and inquire why the roi is too high as market rate is 9.8 % is going on, they said that we are also offering the same roi to new customer but not to old one. So from last 2 years, I am paying high roi emi. Recently, I went to branch to get my interest certificate for income tax, there I came to know, if I pay rs 1145, then my roi will come down to 10.5%. I paid that amount and change will happen from Feb 16. I tried to transfer the my home loan to other banks , but they treat it as a new loan and ask for hell lots of documents. They say there will be no processing fee, but later they ask for around 17 to 20k hidden charges for getting home loan transferred. I tried 3 times, but I gave up due to hidden charges and documents. Someone suggested, that keep this loan going on with LIC wait for some time. If you can suggest which bank is good for loan transfer with minimum or nil charges, That will be great of you.

    1. You can go with HDFC LTD .

  23. Karthik says:

    LIC housing vs HDFC, which is better? And, how many years should I go for I’m availing a loan for say, 30 L? Will long term (of 20 yrs) be better than a shorter term (of 5yrs)?

    1. Both are good ..

      Shorter term is better !

  24. Ams says:

    I had applied online on SBI site to transfer my existing home loan from LICHFL to SBI. One of their guys came to meet me today to discuss about it further and he told that it is now mandatory to buy an insurance for the property from SBI to get the loan.

    If this is correct, then no bank is good, they are purely opportunists. When a product of a bank starts gaining popularity it tries to force some other product along with it.

    Besides, I just came to know from a friend that SBI also charges a few thousand bucks every 3 years as technical charges. I don’t understand what that is, if true.

    Now I have changed my mind to transfer to SBI, looking for an alternative. Please suggest.

    1. Why dont you try HDFC ltd. Its good

      1. Kaushal says:

        HDFC is unethical bank. After some time you will feel cheated

    2. Sandesh says:

      Icici bank .

  25. Binoy says:

    I want to know the difference between
    Baroda Home Loan Advantage and SBI maxgain home loan. Out of these two which is better??/
    Experienced people pls suggest.

    1. SBI maxgain is better

  26. AJIT says:

    Hi, I have finalized a resale property and wish to take maximum home loan (approx. 1.5 cr) . Had a discussion with HDFC & Axis Bank. since most of other conditions they offer are same I would like to go with one who is offering max. loan. They said that it will be on either 75% of market value or 85% of agreement value which ever is higher. Query: can I start the process simultaneously with both HDFC & Axis Bank and based on final sanction letter decide from whom to take a disbursement. Here I may loosing part of processing fee (about 3000/- ). I have mentioned accordingly to both their reps. Please advise whether technically I can do it this way. Many Thanks in advance and Regard – Ajit

    1. Hi AJIT

      Yes you can do that. You can choose later which one you want 🙂

      1. Ajit says:

        Thank you so much for swift response!!

  27. RajeshEdala says:

    Better to take loan from a Bank ( Govt or Private) instead of any Home finance. Home finance gives loan based on PLR not Base rate. So their rate of interest doesn’t change with RBI’s interest rate. Whether it is LIC / HDFC / DHFL , they offer best at initial stage. Later on their rate of interest is more than any bank.

    HDFC Home finance is offering 9.55 for new customers but 10.3 for existing customers. LICHFL 10.15 for new and 11.45 for existing customers.

    If you take loan with base rate +-, when ever base rate changes your interest rate will change. ( either increase or decrease). Go for SBI, Axis, ICICI banks.

    1. Thanks for sharing that info !

    2. sandiip says:

      I fully agree with you

  28. sukhadev says:

    I hv homalean at lic and they r charging me 11.75 % roi. want to transfer the Bslance amout..
    Hdfc is offering 9.55%roi with no processing fees and icici bank is offering me 9.6% roi for ten year fixed and floating also.
    what shold be best option. ?

    1. Looks good . you can transfer

  29. archanpagedar says:

    I have an experience with SBI home loan. SBI is not slow in processing home loan, rather it approved my loan in just a week. I would suggest every home loan seeker to go for SBI Maxgain.

    1. Thanks for your comment Archan

  30. S Edukondalu says:

    I am a central govt employee in Hyderabad and i am 32 yrs and my spouse working in TCS as a SE (24 yrs). Together we draw 52K/mnth. We identified a house in Hyd which is a 139 Sq Yds independent house (resale) and located in gram panchyat. Our requirement is 27 laks and we approached hdfc and icici and they said as per our income we eligible 27 laks but they said property value also must support. Please tell how can i get a home loan around 27 laks and from which bank should i take the loan. Kindly note next govt will announce 7th cpc to central govt employeees.

    1. S Edukondalu says:

      present market rate is rs.20k per sq yd. recently one of my neighbour has taken HL from uco bank and they have given rs.19200 per sq yd.

      1. S Edukondalu says:

        manish ji please give reply

    2. Banks will give you the loan only on the basis of your eligibility and the cost of house. I think its upto them on decide. We will not be able to comment on that !

      1. S Edukondalu says:

        thnk u manish ji. Plz tell about Indiabulls..? shall i go with it or not??

        1. I would refrain from it

  31. Wriju says:

    Hi Manish, I have question regarding LIC housing finance and its linkage with RBI Base Rate.

    LIC offers home loan where for the 1st 2-3 yrs the interest rate is fixed, and after that it becomes floating.

    Now I have heard that once the loan moves into floating stage
    1. If RBI increases market base rate, LIC will increase the home loan interest rate and subsequent EMIs (this is in sync with every other bank/housing finance company)
    2. However, if RBI reduces the market base rate, LIC will NOT reduce the home loan interest rate for existing customer’s and will offer reduced rates to the new customers only. This is a big disadvantage for existing customers.

    Can you please shed some light on this? Or should I post this in the forum section?

    1. I am myself not very sure on how this works exactly.

    2. Samir says:

      LIC Housing finance is the worst when it comes to decreasing the interest rate. They have no relation whether the RBI decreases the rate or not. I have taken a home loan at 11.75% ROI 5 years back and now i will switch to SBI/Axis bank. LIC Fort office is the worst when it comes to communication. You have to personally visit them for small things and their landline numbers are never attended to.

      1. Hey Samir

        Thanks for sharing your experience with all of us. It was a great learning.


  32. Rasik says:

    Can you please tell me whether transferring home loan into Overdraft is a worth or not?

    1. Depends on the situation

      1. Rasik says:

        Could you please justify my statement on OD versus home loan.

        1. I have home loan of 40 lakhs. Even I do part payment (eg. 2 lakhs) my interest would be calculated
        on 40 lakhs. but if I go for OD, transferring Home loan into OD, and pay part payment my interest
        would be calculated on balance amount and not on 40 lakhs.
        2. I will have cash (part payment amount, 2 lakhs) amount in my OD account they I can utilize this
        whenever need arise. This is not the case with home loan when you do part payment.
        3. I understand Interest rate of OD is higher than home loan but point 1 & 2 are exiting one.

        Need to check with you is that can we go ahead and transfer home loan into OD considering above two points. Do we get benefit of tax saving benefits for OD.

        1. Rasik says:

          Can you please reply to my query.

  33. Praveen says:

    I would like to apply homeloan 32 Lakhs. Please suggest me which one is better in terms of pre closure, processing fees, loan sanction days? i talked with a dealer he is suggesting LIC or Axis, saying SBI is charging more for processing fees

    1. SBI is better .. even if a bit processing is high , so what

  34. sushma says:

    Hi.. I am a Central Govt. Employee and I want to buy a flat for which I approached to several PSUs like SBI, IOB etc. but since I have not completed a service of 2 years, they are not ready to give me loan as per their eligibility criteria. But it is urgent for me to buy flat now and so I contacted DHFL and HDFC for the purpose and they both have agreed to approve the loan amount. But now I want advise as to where to approach further for the loan, DHFL or HDFC. Kindly help!

    1. I would have gone to HDFC !

      1. sushma says:

        Thanks!! Am going with HDFC only.

        1. Glad to know that sushma ..

  35. Ravi says:


    I have got two sanctions from LICHFL & ICICI for Amount of 30 lakhs for 15 years.
    ICICI is offering me fixed interest rate for 10 years – 9.90 %
    LICHFL offering Fixed Rate for 2 years – 9.65%

    I am confused with which one I should go, how is the experience with floating rate of these two Institution ?
    Is going with fix rate for 10 years is good option ?
    How is the reaction of people with floating rate of LICHFL & ICICI in past & current rate ?

    Manish can you please suggest me.

    Ravi Jaiswar

    1. I would go with ICICI . A little higher , but a safer option !

      1. Ravi says:

        Thanks Manish!
        One update:
        Now , ICICI is offering 9.65% Interest Rate for Fixed 10 years 🙂

  36. Venkat says:

    Hi Manish, I have outstanding loan of around 29 L with LICHFL and current ROI is 11.75. I am planning to switch to either SBI or HDFC or CITIBANK.
    With SBI, I have to pay around 30,000 charges including stamp duty, property insurance and other charges. Whereas with CITIBANK, charges will be only 0.5% (stamp duty).
    One more advantage with SBI is that, i will be eligible for MAXGAIN. Please can you suggest , which one I should opt.


    1. SBI looks good to me

  37. Chaitanya says:

    Hi, point 1: Took home loan approx.30L in HDFC but they are lack in implementing quick reduction of interest rates and compare to SBI already implemented less interest rates. Being customer in HDFC is it worth to continue?
    Point 2: HDFC is charging huge rates for Property insurance and Life insurance but SBI charging reasonable. please suggest insurance is the mandatory tool?
    Point 3: Intially HDFC given loan in the scheme of 10:80:10, 80% is the Home loan and rest down payment and now paid only 10% please suggest at this time will I get loan transfer to SBI?
    please suggest, Thank you.

    1. Hi Chaitanya

      1. I would have continued it
      2. Property Insurance is mandatory with SBI , but not with HDFC
      3. I cant answer this

  38. nikhils says:

    Hi Manish
    I have taken loan from LIC HFL some 3 years back of 21L, Now I want to transfer my Loan to either SBI or HDFC. Current Principal Outstanding is 14.5 L and loan tenure I am looking for is 10 years.

    SBI – Offering at 9.75%, but they are asking for lots of charges like 4500/- + 0.25% Procc Fee + 0.2% MOD charges + Property Insurance. Also they are not giving me SBI Max gain option as the Loan amount is below 20 L.

    HDFC – Offering at 9.90%, they are waiving Procc Fees for me, need to pay only MOD charges 0.2 % + 570/-. Plus giving option of 3\ 10 yrs fixed plan

    Please suggest which Bank i should opt for HDFC or SBI. If HDFC can I opt for 3 yrs fixed interest rate at 9.95%


    1. Nikhil

      Did you calculate which one is saving you more in two options ?

  39. Venkat says:

    Thanks for the article. Any particular reason why Citibank is not in the list? can you please share your review on Citibank home loans especially their “home credit” product.

    1. It just didnt appear in top 5-6 in the survey . Thats all .. It does not mean that its bad ! ..

  40. ANILESH DEB says:

    Hi manish i need a homeloan around 20 Lac. Wich bank is suitable for me

    1. There is no formual to tell that. I suggest try in SBI , HDFC

  41. Sumanth says:


    I am planning to take plot loan from PNB finance Housing. Please suggest if it is better than other finance providers like LIC, India Bulls.


    1. I am not sure on this .

  42. Roshan says:

    I am applied for Home loan in LIC Housng Fin, 24 lac for under construction and interest rate 9.80 fix for 2 years.
    first demand from builder is 12 lac which need to pay.
    LIC Housing Finance offer me to start EMI on full loan amount (24 lac) which help loan gets repaid quickly.( interest in 12 lac + remain will be pricipal pay)
    I am able to pay 24k EMI

    Please suggest me about this offer ( will i go for full emi (24 lac) OR 12 lac which i will get home loan)

    1. Hi Roshan

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that


    2. Raj says:

      HI Roshan,

      The option for full EMI deduction even though payment made to the builder is by part, is a good option as the additional amount paid by you will be settled in principal. This will reduce the interest portion in the long run.

  43. DIPAK says:

    Dear all.

    My home loan amount is Rs.38 lacs.
    Taken in january-2013 from TATA CAPITAL HOUSING FINANCE LTD. Tenure-20 years.
    at floating interest rate. At that time it was 10.75%. Right now its 10.90 %. (as on 31-8-2015).
    Repaid around 1.5 lac (Principal) till date.
    Remaining amount around-36.5 lacs.

    SBI is offering at 9.75% and Processing fees- 0.25% of loan amount (Around Rs.9000)
    HDFC is offering at around 9.9 to 10.40 % Processing fees-0.5% of loan amount(around Rs.18000)

    Should I transfer my home loan to any other bank?
    Please give your suggestions in detail.

    1. I think you can transfer it to HDFC

  44. Madhav says:

    Hi Manish – I am planning to switch from my existing bank (@10.05%) to SBI (9.75% with Max gain account). I read about lot of good features about max gain account and am inclining to switch soon. But, SBI has lot of initial charges including 0.5% stamp duty, which is coming nearly 18,000/- rs. So, is it worth switching to SBI with the pain of initial amount

    1. If you are saving more than 18000 overall, then yes its worth , else not

  45. Dev says:

    LIC Housing is Bad. They have hidden charges.
    They offer you lower fixed rate (9.5 in my case) for 3 or 5 yrs and then it will be floating. They won’t inform you when that fixed rate period is over and the ROI is changed to 12 or 12.5% automatically. Then you have to pay 0.5% (10,000 for 20 lac loan) of your loan amount to reduce ROI to 10.5 something. Cheaters!

    1. Thanks for your comment Dev

  46. Rahul says:

    Hi Sir,
    I wanted to make a query regarding home loans,
    I live with my parents and grand father in one half portion of the house and my uncle, with his family, in the other half of the house,
    The house is owned by my grand father who is 86 years old and has old age health issues,
    In future, the house will go to my father and uncle equally.
    At present, my uncle wants to shift to another city and is not intending to come back.
    As a result of this my grand father don’t want that after him, the house should be sold off (emotional attachment) to settle the issues between 2 brothers, on the other hand I don’t want to leave the house because of its location being very convenient to my parents and grand father (hospitals, markets, commercial area are at walking distance),
    I have decided that I buy half portion of the house from my grand father, that money can be used by my uncle to buy a property in his city, in this way problem can be sorted out amicably and all 3 parties-me, grand father and uncle will be happy.
    PROBLEM is banks are saying “NO” to give home loan in this situation.
    Sir, kindly advice me what should be my step to get any bank to finance me in this situation.
    The house worth a lot and it will take me a long time to earn that much amount of money, and when I will. the price of the house will again rise.

    1. The bank is saying no, because its a complicated case with family issues

      1. dipak says:

        Go for personal loan. It should help you a lot

  47. harikumar says:

    I am plan to take 10 lakhs loan for buy a house . kindly suggest which bank is better for me and who is the market leader i n homeloan

  48. kavitha says:

    Dear sir, how are you please tell about LIC Home loan procedure and i will apply bank loan for Rupees 4 lakhs. so how much amount i have to pay monthly. because this is my first time applying home loan .. please reply me sir

    1. vandana says:

      Do not apply for LIC housing fianance they charge you more. There is no support from the bank..

    2. Dev says:

      Agree with Vandana. They have hidden charges.
      They offer you lower fixed rate (9.5 in my case) for 3 or 5 yrs and then it will be floating. They won’t inform you when that fixed rate period is over and the ROI is changed to 12 or 12.5% automatically. Then you have to pay 0.5% (10,000 for 20 lac loan) of your loan amount to reduce it to 10.5 something.

    3. Hi kavitha

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that


  49. RAKESH SARMA says:

    Sir one question from mee.. That which is the best bank for housing loan about 15th lakhs for middle class family SBI or LIC

    1. SBi is better , but LIC is not bad !

  50. Prabu says:

    I have small doubt…once we are starting EMI,first we have to complete our interest for first few months.then only start our Main Loan amount for reducing coming months, correct? In this scenario applicable for all Banks? because after 3 years am going to close my loan means i have to pay all amount,its not useful for whom they are going to close loan with in 3 to 5 years.
    For example DHFL housing loan first 6 month they charged only interest then only start our main balance reducing.

    1. Yes, if you are planning to prepay within 3 yrs, then you would not benefit at all !

  51. Nishant says:

    Dear Manish,

    Need your help on below mentioned situation.

    Father was allotted a flat by Welfare Housing Organization on 10th Oct 2012. Father is 79 Years old & retired from Army. Applied in Bank for Loan. Bank refused loan @ 79 years of Age whereas earning is not a concern. Father was applicant & Daughter is co-applicant. WHO was requested to add a co applicant. WHO issued a Tripartite agreement & No Objection certificate to take loan with MARRIED daughter. On the basis of TPT & NOC from WHO, bank approved loan. Conveyance deed was executed on 13th April 2015 with Father & Daughter. EMI is being paid by Daughter.
    Legally property is 50:50 of both the Join Registrants. Now, Father wants to Sell his 50% of his part to Daughter. Gift Deed is not an approved solution by WHO. Will is not a workable Alternative. In Rajasthan re-registration with in tenure of 2 years, 2% charged on Conveyance deed.
    WHO will release NOC when bank will issue NOC or we clear the Home Loan. NO Possibility to clear Home loan due to liquidity constraints. Now, option available is to take NOC from bank. Bank is asking to clear the loan first, then only NOC can issued.

    Please suggest.

    1. Hi Nishant

      Your cases is a bit complex and I think we are not the right people to comment on it.

      My suggestion would be hire someone who is professional in this area and consult them


  52. SUMAN POTUGARI says:


    1. SBI is one of the best options and post taking home loan , the life is easy . But if you are not getting it from SBI , then you can go with DHFL ..

  53. ishan says:

    Can you please send me that excel sheet for calculation of daily reducing balance and monthly reducing balance about which you were talking in 2012. I red about it on some of the starting comments. My email id is : ishan2290@yahoo.com / ishan2290@gmail.com. Please send on both mail id’s.
    Actually I am going to take a home loan for around 25 Lack. This loan will be a combined one as I am not eligible for 25 Lack loan alone, me and my wife (going to be in a year) will take it in which she will be applicant and I will be so-applicant. Sonfused between SBI, SBI Max Gain, HDFC and IDBI. Your suggestions are most welcomed. Please reply ASAP
    Thank You

    1. Which sheet are you talking about ? We dont have anything like that !

  54. ritzshaan says:

    i had a very good experience with hdfc ltd till now ,
    from 2009 to 2015 i have taken 3 home loans in total , cleared in 2 years from the commencement of loan period ,
    i found there overall service very good as they used to inform me about all the rate changes, how i can save more by conversions , all statements were delivered at my home without any hassle , no problem with part payments and full closure, documentation was at ease , a month back i have closed the 3rd home loan .
    now i am going for my 4th loan with idbi as hdfc ltd dont give loan for commercial property to nri ,
    hope this move will be as fruitful as the past ones 🙂

    rgds manish nagpal

    1. Hey MANISH

      Thanks for sharing your experience with all of us. It was a great learning.


  55. Sudesh says:

    Dear Manish sir, GM, I aged 49 years,have choosen a Ready flat(2nd Home) costing Rs. 20 Lacs. I have arranged 10 lacs from my Debt Lequid Fund & balance from Home Loan. The project was approved by Indian Oversas Bank & DHFL.. and builder is insisting to get loan from DHFL instead of SBI/ICICI/HDFC. i have another 10 lacs in Equity MF.so shall i take loan from DHFL?or pay from my equity MF. pl. advice.

    1. I think you can go for loan if you can pay the EMI easily. Also the builder cant force you for loan from any specific company. May be he has tie up with them to get commission .. check on that.

      Also if your builder is ready to give a discount on full payment, you can then look at your equity mutual funds also

    2. sudesh says:

      Thanks for your reply & guidance. I approached SBI,HDFC,ICICI, but only DHFL responded quickly through builder & completed documentation parts etc.Hope this transaction will be smooth as like my previous Housing Loan from ICICI (re-payed within 3 years)

      with Regards.

      1. Thanks for your comment sudesh

        1. Sudesh says:

          Dear Manish,

          Today i recd Loan sanction letter by email for Rs. 10,81,204/-, but i have some doubts about fixing of EMI. details as below

          Sr.No. Sanction Amt. Period Int. Rate EMI Int. Type Int. Rest
          1 1081204 10 9.90 14229 Veriable Monthly

          Standard Sanction condition

          Sanction condition by Branch
          Sr.No Sanction Condition
          1 All original documents to be provided for verification before disbursement
          2 Disbursement is subject to Credit verifications Satisfactory
          3 All documents to be self attested by applicant/Coapplicant.
          4 Disbursement subject to providing the latest bank statement of all accounts.
          5 Loan will be disbursed subject to legal and technical clearance.
          6 3 PDC/ECS with 3 security cheques/Salary Deduction with 3 security cheques
          7 DHFL Home Shield H L Assure Insurance policy equal to loan amount. Premium (Included in loan amount) Rs.. 59472/-
          8 Residential property Insurance, Personal Accident Insurance policy & family Floater health Insurance cover underwritten by Chola MS General Insurance co Ltd, the premium amounts are Rs. 5290/-, Rs. 2280/-, Rs. 14162/- respectively
          9 Own contribution proof with bank reflection to be submitted before disbursement
          10 LTV to be restricted to 85 %
          11 Latest salary Slip along with updated bank statement with latest salary credit to be obtained before disbursement.
          12 Form No. 16 to be submitted before disbursement.

          sr. 7 & 8 included in sanction amout(i.e. Rs. 10 Lacs+59472/-(home insurance) + 21732/- (prperty insurance+personal insurance+health insurance)). but EMI is caluculated on Rs. 1081204/- in stead of Rs. 10 Lacs. is it correct. pl also advice for any new points i can bargain with DHFL.

          1. Hi Sudesh

            This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that


  56. DJ says:

    I have a query, currently we have a mortgage loan in Bangalore City Co Operative bank.
    We are looking for some bank to take over the loan from BCCB. Can SBI take over the mortgage loan from BCCB.
    We need help in this case, if not i would like to know if any other bank can do so.
    Please help with any information.

    Thanks in advance.


    1. You need to check it with SBI, are they ready to take over that or not .

  57. Rashmi Bhatia says:

    Hi Manish,

    If we have a Personal Loan on us from Citi Bank, can we still get Home Loan from SBI Bank?


    1. Yes, you can still get it

  58. Ramesh says:

    Hi Manish,

    Need suggestion on which bank to select for home loan – LIC or HDFC.

    Heard LIC will increase the interest rate during post fixed rate period.

    Pls suggest one in this with some gud explation, if possible

    1. I had a good experience with HDFC

      1. Ramesh says:

        is there any charges during the loan transfer to low interest rate bank in future? pls provide ur input

        1. Yes, there can be charges levied by the lender

  59. vijay says:

    never go with ICICI Home loan, they really suck in customer service.
    surprisingly they ask you to visit branch for getting a statement of your accounts.
    curtesy : http://www.icicibank.com/Personal-Banking/loans/home-loan/home-loan-statement.page

    1. Hey vijay

      Thanks for sharing your experience with all of us. It was a great learning.


  60. rahul says:

    hi ,i am a salaried professional and am plaaning to take a joint home loan along wiht my brother(salaried employee)

    does any banks provide joint home loan for brothers

  61. Sudarshan says:

    Dear Sir,

    I read all your blogs. Thanks a lot for sharing all the imp info with us.

    I have to take home loan, Can you please let me know which is best option – Variable interest rate or Fixed interest rate as per current market situation?

  62. shivendra says:

    I was buy a underconstruction flat which is approved by all leading bank and bulding finance by sbi bank. I need a home loan axis bank offer me 10% +70%+10%+10% plan but sbi offer me 20%+80% plan….which is best option. Pls suggest me Which bank is best after disbrustment of loan and pls explain sbi maxgain plan……

    1. I have found HDFC to be very good . You can read about SBI maxgain here – http://jagoinvestor.dev.diginnovators.site/2013/05/sbi-maxgain-home-loan-review.html

  63. Hello Avishek Roy

    Maybe your guidelines is bettter but I thought over all private Banks is better for everyone. Not specific like HDFC.

    1. Welcome .. Glad to know that Magma Fincrop ..

  64. Avishek Roy says:

    Hi Manish

    I have option of going with HDFC or LICHFL, LICHFL is offering 2 years fixed 10.10% and floating thereafter, Interest calculation on monthly reducing basis. and No Foreclosure charges when it is Floating.

    Could you please guide me in which direction I should negotiate with HDFC to have a overall better offer?

    1. Hi Avishek Roy

      What is the rate HDFC is offereing you ?

  65. anuj says:

    Dear Manish , I need some suggestion in home loan or rather say loan as some of my colleagues are buying flats by taking home loan from SBI and the agent is also suggesting me the same but I do not have the money needed for down payment so he is suggesting me to take personal loan of 5 lakhs for down payment and home loan from SBI and to pay the personal loan consequently as soon as possible and let the home loan EMI be continued to take the tax benefit. on calculation I found that sum of both the EMI added will be approximately 40% of my present take home salary. But shall this be good decision to take two loans simultaneously… I’m confused …kindly help me over this issue.

    1. Hi anuj

      If you can afford the EMI and if house is indeed your requirement then I dont see much issue in going forward with this .


  66. Chitransh says:

    I was searching a lot for the same question, like which bank to chose for applying home loan since all the banks are apparently almost same in terms to rate of Interest and other benefits, fortunately 1 of my friends working with a software company in Hyderabad referred me to Union Bank, probably a less familiar bank in south India, even though i was initially reluctant to go with Union Bank, the first interaction with the bank officer impressed me a lot, he cleared all the doubts in a phased manner and managed a Home Loan for me within 2 days after submitting the documents, and believe me the bank has many differentiations over and above other banks including SBI & HDFC, and yes they dont charge you a rupee after the sanction of loan, i was amazed because I had to pay statement charges at HDFC bank every time I needed a statement., then xerox charges, document charges, this charge that charge, and so many to follow untill you close it totally. I recommend you to visit nearest Union bank or atleast the website.. I recommend Union Bank.

    1. Hey Chitransh

      Thanks for sharing your experience with all of us. It was a great learning.


  67. Avinash says:

    Can you suggest, should I take Homeloan from LIC HFL or Indian Bank or Indiabulls, Please suggest the best option.

    1. I would suggest LIC HFL among these

    2. Chitransh says:

      check out Union Bank.. i think they are now offering a very competitive rate of interest.

  68. Siddharth Mehta says:

    Now HDFC home loan office started new thing. I got to know today. They don’t accept service request related to bank transaction on Saturday. Means for existing customers they don’t accept 90% of request on Saturday. I don’t know what more hidden things are there. I am NOT recommending HDFC for homeloan and suggest to transfer existing loan to other bank. I am definitely transferring my loan to other bank

    1. Hey Siddharth Mehta

      Thanks for sharing your experience with all of us. It was a great learning.


  69. Pankaj Singh says:

    Great post Sir . I’ve one question for you. My approximate salary is around rs 2,50,000 INR. I wanted to start a small business with my 2 partners. The budget is around 25 Lakhs. Which will be the best bank for long term installments.

    1. You can open it with ICICI bank

  70. subash bhandari says:

    am planning to take home loan from bank of baroda
    do you have any idea about that?
    will it be good?

    1. Yea you can do ahead with that, NO issues . Do you want me to assist on this . I can forward your details to http://www.bankbazaar.com/?refId=MANIQ6W1 and they will help you on that !

  71. Harsh says:

    I have completed my PG in June-2012, and got the job on Jan-2014, having experience of 1 year. I have Form 16 for Jan to March 2014. I have all other documents mentioned in SBI document list. I am permanent in current organisation. I want to ask can I get the home loan from SBI or any other bank?

    1. Harsh

      Most of the banks will need your 3 years of IT return and a good enough salary 🙂 . If you have both of these, you can surely get a loan

      1. Harsh says:

        I have no source of income till 2012 as I was student. And now I have good package.

        1. I think it will be tough, but you can still talk to banks . Most of the banks will surely require 2 yrs IT return !

  72. Manish says:

    Can any bank give the home loan scheme for physically challenged person.

    1. Yes Manish

      Its possible, but you would need income proof and standard documents

  73. HDFC Bank ranking as number 3 incorrect , as they do not do home loans , it must be HDFC -Mortgage Leader in India !

    1. Yea that needs to be corrected , will do that !

  74. Sun says:

    I don’t think this survey is worth to consider. This is more line the personal feeling.

    1. sure .. its a personal decision if one wants to consider 2000 real life reviews or not .

  75. pankaj says:

    My monthly pay 28000 in bsf n have 3 lack n I want 10 lack loan from hdfc to buy a plot/property in near ghaziabad what document u need but now I have not property .

    1. Hi Pankaj

      They would need your 3 yrs ITR along with income proof

  76. Swapna says:


    I want to take home loan from SBI.
    But for SBI ,IT Return documents are compulsory and they want It Return for 2 consecutive years.I have it but not consecutive.But i have form 16 for last 3 years.
    Is there any other option? Because after reading this article and reviews from all of you,I want to take home loan from SBI only.
    Please help and guide me.


    1. SBI is too strict on documentation part, I think you wont get it if you do not have last 3 yrs ITR !

  77. mohan kumbhar says:

    As per generalities SBI home loan is more complicate than HDFC in view iwth supporting document

  78. Hiral Parekh says:

    How does SBI bank beneficial than ICICI bank in long term while giving home loan? Please advice

    1. They generally have lower interest rate 🙂

  79. kiran says:

    Icici is the worst.. they are blood suckers

  80. Loan Superbazaar says:

    If we look at the above mention ranking to all banks for home loans then its almost correct but not 100% because Service part also matters when you take home loan. HDFC Ltd is a company who works very professionaly in home loan industry. And if you have a perfact example of management then all can try for better then best. Its very difficult to know who is best and in which part or overall for that you need to go through all banks which is not possible and now you can take the feedback from existing borrowers of all banks who took home loan. But a Company who deals in one product or home loan for a long time that can serve you better and keep you safe.

  81. Chellapillai says:

    Hi Manish,

    I am planning a take a home loan from HDFC Bank. I work for a private company which is not listed in HDFC bank. When i contacted HDFC representative, they said we can process it and this would not be an issue. I am not very confident whether i will get it. Please advice


    1. I suggest in that case keep it as second option .

  82. zuber says:

    Dear All,
    Please help me as i am badly stuck. I took SBI Maxgain home loan for my property in Dec 2009 with conditions of 8 % for 1st year and 8.5% for 2nd and 3rd year and then 4th yr onwards 2.75% below SBAR. Due to my job i could not track my loan acount and now i see that from first year itself SBI has been charging me 12 to 13% per year and today im being charged 14 %. Out of frustration i applied for balance transfer with ICICI (my salary account bank). They are offering me 10.15% with 50% waiver on processing fees. After SBI guys got to know my balance transfer plan, they became quite friendly with me and are now offering me all help and may be also refund excessively charged refund.
    Please help me on following- 1) should i continue with SBI 2) if i decide my mind on balance transfer then is ICICI a good choice…please help

  83. vineetvagarwal says:

    Dear Manish,
    I have recently applied for a home loan at SBI. My Cibil score 810. I’m facing trouble with the bank there are stating that i’m a defaulter at RBI list for my education loan and no bank will issue me a loan.

    In 2005 i have taken an education loan from Union bank of India which i closed in next 2.5 yrs (2012) post my graduation (2009). I also have a no dues certificate for the same from the bank. My parent visited the union bank of India there the manager was really helpful he generated the cibil report, searched RBI records accessible and said that I’m not listed as an defaulter. Moreover he also explained my parents that RBI doesn’t add a person name as defaulter for small loans.

    Can you guide me the next step which i should follow.

    1. Yes, RBI does not add anyone as defaulter. Which bank is telling you that you are defaulter . If your report in CIBIL is clean, then there is no issue in reality

  84. Karan Mahajan says:

    Hi Everyone, I’ve finalized the property and my home loan is on the verge of getting approved. I’ve applied loan in HDFC as they hold my salary account, so its easy to get the loan. A small question that comes to mind is that Is the Home Loan offered by HDFC is on Reducing Balance Basis?
    Please share.

    1. Yes, its monthly reducing

  85. kishore says:

    Sir, I’ve made an agreement for Rs, 25lacs for under construction flat & ‘ve paid 5 lacs as down payment & the remaining i.e. 5lacs I wanted to pay as my own contribution in due course of time to builder which is before possession 2015 .Therefore I ‘ve applied 15lac home loan with HDFC .But the bank refused ,either I pay my contribution now or availed 20lacs a home loan ,Helplessly, I applied for 20 lacs which been approved but not an affordable EMI for me .Is there any way I can avail only 15 lacs which is affordable EMI & the rest amount I propose to pay to the builder in due course of time. Also can i take full EMI on 15 lacs . SOS

    1. Tell the bank that you cant pay the full EMI . I am sure there is no mandatory requirement that you take full loan only ..

      Also them to increase the tenure of loan if its not possible to reduce the loan amount

      1. kishore says:

        thanks Manish’

      2. Lucky says:

        Dear Manish, I feel you article is very informative but the same needs updating / correction. A glaring issue is you have mentioned HDFC bank for home loans, HDFC Ltd is a home loan financier which is NOT a bank, HDFC Limited is governed by NHB regulations.

        As on date in June 2014, HDFC Ltd would rank as the worst Home Loan lender as they are very unprofessional by debiting charges left right and center to the loan accont even where i is totally undue.

        Please google HDFC home loan reviews and check for yourself. Personally I would NEVER recommend HDFC Ltd housing loan to anybody.

        HDFC Ltd is not a bank, the article needs to be updated /corrected. HDFC Ltd is one of the worst home loan or housing loan providers in the year 2014. They would rank last. You can google HDFC housing loan review and you will understand.

        Regards, Lucky

        1. Hi Lucky

          Yes, I agree I made that mistake. However I am not sure if HDFC Ltd is so bad overall . May be you faced some bad experience, but is that an average experience of HDFC LTD customers ?


          1. Raj232 says:

            Dear Manish,

            Thanks for your response. My request would be to change “HDFC Bank” to “HDFC Ltd” as they are 2 different entities governed by different regulators.

            HDFC Bank – RBI
            HDFC Ltd – NHB (National Housing Board)

            Had we been in the year 2012 HDFC Ltd was competitive and straight-forward. However in 2014, that does not seem to be the case. If you did a poll I think it would rank last along with DHFL, etc.

            Hope you will take it positively and keep up the positive image of jagoinvestor by correcting the error. Thanks again.

            1. Yes Raj

              Let me make that change soon .


            2. Raj says:

              Yes, take your time to make the change, however you are guilty of misleading innocent people by incorect information posted til then.

  86. Naren says:


    According my eligibility for home loan, the following are the options provided by different lenders. Please let me know which one is best for long term and I can save the money.

    Lender A
    Eligibility – 2450000
    ROI – 10.25%
    Tenure – 20
    Rate type – floating from day one
    Processing Fee – 11800
    Prepayment charges – Nil

    Lender B
    Eligibility – 2500000
    ROI – 10.10%
    Tenure – 20
    Rate type – fixed for first 2 years and floating afterwards till the end of tenure
    Processing Fee – 15000
    Prepayment charges – Nil


    1. I would go with Lender B

  87. Pradeep says:

    Can you please share the excel sheet for calculating emi based on daily reducing balance and monthly reducing balance to the mail id pradeepl.psg@gmail.com ?

  88. sachinst says:

    HI Ramesh,
    Try indiabulls Home Loans currently they offer home loans @10.25 and home loan approve in 48hours. And the best thing is you don’t need to visit their office for submitting paper and all things, their representatives collect required documents from your house.

  89. RAMESHA VARNA B says:

    Sir My name is Ramesh. I want to avail property loan to buy a plot in Bangalore. Land developer is telling loan is approved by SBI, ICICI & India Bulls. Which one is good for me as I am a salaried person.
    Also some one told me that if I go for SBI, I have to start construction of the house within 2 years. But I can’t. Also SBI takes more time to sanction the loan. But ICICI donot put that condition of house construction. But I had bad experience with ICICI earlier.
    So please guide me which is the better Bank for property loan of Rs 10Lakhs.

    1. good and bad experiences are not standard. I mean you can have bad experience with SBI also later and very good with ICICI later on . I would say that if you are getting the loan, its better that you take it right away !

  90. Manish Mahanti says:

    Hi Manish. I would like to take a Home Loan and get settled. I am looking at a property with overall cost of 38 Lakhs. I am finding it difficult to fund the 20% amount and booking amount. My savings are low. Can yoi recommend something to me?

  91. Soundarya A says:

    I think Indiabulls Housing Finance is also good choice who wish to avail home loan. Their home loans schemes are affordable and suited my budget.I personally had a great experience working with their staff. They are friendly, well versed with the home loan schemes and market trends.They were extremely patient in answering in all my queries about home loan schemes and guided me at every step.

    1. Thanks for sharing that 🙂

  92. Prabakaran says:

    Hi Manish,

    Thank you for information. but why u prefer Hdfc ?…Any specfic reason in my situation?….your answer will be helpful for me to go the Bank.

    1. Nothing specific, its one of the most bought one !

  93. Prabakaran says:

    ok.. i will ask this to bank…. I have LIC policy as well as Axis bank account. i seen both are giving same interest rate. i have little bit confuse with would i prefer. can you please suggest me, which is best now for me applying loan

    1. If I were at your place, I would go with HDFC only !

  94. Prabakaran says:

    Hi Manish,

    I am planning to take a house loan for constructig new home. I am planning for 15 lakhs.I am working in MNC company, now my take home salary is 50k my problem i have no form 16. this year i will get, but i am going to apply on this month. previously i worked 6 month in one company of take home 33 thousand per month. no tax deduction .i asked form 16 they told your six month salary is comes under below 2 lakhs. so not possible to provide form 16 but they provide salary summary. already 3 year worked in one company they provided salary as stipend. I have LIC policy as well as Axis bank account. i seen both are giving same interest rate. i have little bit confuse with would i prefer. can you please suggest me, which is best now for me applying loan .

    1. I have no solution for form 16 problem, its a company specific requirement and if its not there, I am not sure what you can tell to home loan company .

  95. Azhar says:

    Hi All,

    I am getting home loan from HDFC at 10.25% (fixed for 2 yrs then floating)with abt 10k Processing fees. and from Axis bank at 10.25% Floating with no Processing fees. What would you suggest me to do?

    1. While you are surely saving on Axis bank, over a long term I think HDFC would turn out to be better from service point of view !

      1. Azhar says:

        Hi Manish, What about LIC Housing Finance? 10.35% fixed for 2 years. It may be reduced to 10.25%.

  96. Raman says:

    Recently, I approached many PSU banks for takeover of my home loan from HDFC.

    HDFC is charging me 11% interest rate on a loan of Rs.38 lac. The property is still under construction but in final stages.

    Here is the response I received from these nationalised banks.

    1. SBI – they say they will not take over home loan for under construction property.
    2. Syndicate Bank – after making several visits to their Karol Bagh branch, they also said they can not take over under construction property.
    3. Canara Bank – Same response.
    3. Oriental Bank of Commerce – The gentleman sitting in the manager’s chairs wants me to take him to the site first before he can comment on anything. The attitude was like why did you come to this branch, go elsewhere. Why does he need a site visit even before telling me to apply for the loan.

    Does anyone know of any PSU bank which will take over my under construction housing loan from HDFC. Is that really a requirement that I should have the possession of the flat before they can take over or are they all taking me for a ride.

    Also, in case the property is not on bank’s approved property list, they should be able to get the legal and valuation done at my expenses. Can banks deny a property just because they have not financed it in the past?

    1. Hi Raman

      First point is that bank has no obligation to finance your loan, its 100% their decision on what they want to do . So if they are saying they cant do it, then they cant do it. The best you can do is ask for the rules from them through RTI !

  97. dipankar says:

    hey guys dont go with big name or fame bank..or any co-operative bank..they harass u later..
    go with some bank like..example:- indiabulls housing finance .. bcz this bank is on growing age, and give their best effort for take position on this market. and they gave u defenetly good and best service from their service..

    1. Do you have any personal experince ?

  98. subashinirajan says:

    SBI has been charging me for insurance which I had cancelled. This money is along with emi. This issue has been going on for 2 years without any proper response from the authorities. Is there any use contacting banking ombudsman, since it is more than a year since I first complained?

    1. Yes you should do that now . And more than Ombudsman, I think you should move to consumer court !

    2. I suggest first file a RTI for this and get the status , they will have to give exact status to you on RTI .

      Next you also tell them that you will move to consumer court if they continue harrassing you like this

      1. subashinirajan says:

        Ok. I will file an RTI first. Thanks a lot.

  99. Satish Kumar says:

    Hi all,

    I’m Planning to take 25 Lakhs Home loan from ICICI bank which is offering floating interest rate of 10.15% which is best in market i think. Moreover bank is ready to provide fixed interest rate at 10.25% for the first 2 years. one important thing they are saying is that they will process the loan within one week, Should i go head with this and is there any other best deals available in market. Pls let me know.

    Thanks in advance..

    1. If its on FIXED rate, the RBI rules of no charges on preclosure will not apply , so I think its better to go with Floating rates ! , however I suggest you discuss it more on our forum http://www.jagoinvestor.com/forum

  100. ravikumar says:


    The home loan is very common type of loan that is availed by the common man for the purchase of home.I would like to thank you much for providing such a use full inf. This information really helps every Indian who has taken home loan..

  101. Santosh Rachakonda says:


    I have applied a loan and got sanctioned through LIC Housing Finanance at f;oating interest rate of 10.25% in july 2012, and with in six months they raised it to 12% while RBI rate is only 10.25% for today. I am thinking of shifting to SBI , can you suggest is it preferrable or should i stand back with LIC. My concern to shift is i already paid about 3,36,000 as interest in this financial year, so which may be loss to me if i move now. Kindly suggest.

    1. How is it a loss, like you were paying in LIC, you will pay to SBI from now onwards . Your loan outstanding will get shifted, its not there it will restart !

      1. Santosh Rachakonda says:

        Thank You for the reply Manish, so which is good whether to shift to SBI or stand back with LIC. Because is it possible SBI will also give me low interest rate intially at time of joining and increase it later as LIC did for me now.

        1. Santosh

          If you loan is on floating Rate, then it gets reset every 3 months . Didnt you knew this ? Any bank will surely raise it later or decrease it as per the movement in interest rates


  102. sreeni says:


    I contacted both LIC and HDFC represents.. HDFC is ready to give 30L where as LIC is giving max 27 L. I m not able to understand why like this and same i asked LIC person he said that HDFC guys will managed that, but later I may need to pay some extra fees . I m still confused which one i should choose. Please suggest me

    1. LIC is lying , there is nothing like that ! .

      NOte that both have their own way of calculating your eligibility for loan , so it can be different !

  103. sreeni says:

    Thank You Manish for your reply. Can you please explain me why HDFC is best. Because where I m planning to buy house there out of 25 houses 15 already processed by LIC and only 3 or 4 guys went for HDFC. so please tell me what are the benefits I get if i choose HDFC.


    1. Its not the best, Its just one good option . HDFC processing might be better than LIC being a pvt entity and having a much wider reach . Thats why I suggested it . Also it would be good idea to have a word with both companies representatives first and then move ahead !


  104. sreeni says:

    I am planning to take home loan for 30L, I am not able to choose which one is best among LIC and HDFC both are offering 10.25% for 2 yrs and after floating. Please suggust me which one is the best .


    1. If you can get it from HDFC , go for it then

  105. PRASAD says:

    Hi Manish,
    Please help me to take home loan in this present situation which bank best to give lowest intrset rate

    1. What help you need from us ?

  106. Mohit says:

    I had my loan from india bulls at 10.10% percent but some days back I got a mail that they are changing the rate to 10.75%, Now I am getting lots of offer from other bank like ICICI at 10.10% and HDFC at 10.25% so shall i go for any other bank because they are also offering the flexi plan only.

    Please help me in knowing whish bank is better for me to go.

    1. Surely you can move to others if the whole deal is profitable , Did you do all the calculations yourself ?

  107. Mohit says:

    Hi Manish,

    I have taken loan from India bulls this year only and they offered me at the rate of 10.10% on flexi, But Now send me a mail saying that they will 10.75% for this month onwards that is really pathetic, Now I am getting lots of option from other bank like ICICI at 10.10% and HDFC at 10.25 but both are floating.
    So I am bit confused that which one I should prefer and would be best for future.
    I don’t want to transfer it again and again.

  108. jamesfanklin says:

    Yes I agree, SBI is better to compare to other banks taking home loan..i applied for Home loan in SBI, you have written true facts that Private Banks are good before taking Home Loan and Govt Banks are good after taking Loan. thanks for such use full information

  109. Home Loan says:

    I agree to the fact that buying a home is a dream come true for most people and once in a life time opportunity for many.Not all people can buy home loans on their home and have to take home loans from banks. Its vital that you compare the rate of interest on home loans and then opt for the best. I recently bought a home loan from Pnb housing financial with very low rate of interest and was able to buy my dream home. The other banks including the above mentioned are Canara Bank and Punjab National Bank.

    1. Thanks for sharing your experience on home loan !

  110. Dr. Vijay says:

    Resp. Manish Sir,
    I am about to own a flat 2BHK for my family in Jalgaon. I am working as a permanent medical officer as Class 2 officer post. Joined recently 5 months back and worked back 4yrs on contract basis at civil hospital before this job. I want to take loan of 15 Lakhs rs. We have salary account in Axis Bank here now. I have Form No. 16 of yr 10-11 and 11-12. form 16 for yr 12-13 not obtained yet. I have car loan from Mahindra n Mahindra and only last 5 EMI were left out of 48. which bank should I prefer. may I Axis Bank or LIC Housing? Please suggest. give me the best deal. thanks in advance.

    1. Try Axis Bank only to start with , As you already have an account there, mostly it should be smooth process

  111. setnhil says:

    hi, we have taken a home loan for 12 lakh at floating rate in 2006. On 7-2012 we reduced the floating rate of interest from higher 11.75 to 10. 50 by paying some amount.Now its 8 lakhs now and interest rate is 11.The problem is there are saying that we cant reduce the interest rate it can be done only once.Is it true?

    1. The rates have to be changed for all customers .

  112. Praveen says:

    I have a Homeloan in Axis bank for around 19 lakhs with currentROI 10.75%. And found that Canara bank is offering an ROI of 9.95% for balance transfer. Please suggest me whether i can opt for balance transfer.

    1. Did you do all the calculations ? I mean which option will be better ? Any homework from your side ?

  113. Pravin says:

    hi manish…

    very useful article… thank u for the info…
    im in dilema to chose between SBI and HDFC home loans…
    SBI is offering 9.95% and HDFC @ 10.40%… im planning to take 23lakhs for 20 years..

    i feel processing with hdfc is quiet easy where as sbi is quiet strict.

    please suggest me which one to choose….

    1. Yes, processing with HDFC would be comparatively better compared to SBI !

  114. Anil Kumar Jaiswal says:

    Hi Manish,

    I have also applied for Home Loan to LIC HFL, I have few questions regarding that, which are as follows:

    The agent says, the ROI would be 10.60% fixed for 2 years & thereafter floating. I think the floating rate would be mentioned on the sanction letter or will purely depend after two years.? & what is the LH PLR is mentioned and no discount n it is mentioned ?

    Next is , I have applied through an agent, with whom the builder had contacted me, is it safe to depend on the agent..? even though he will not charge me anything.

    and last, I am an employee of a Public Sector Co. ( an enterprise of Govt. of India), though I am not yet confirmed ( I have the appointment letter, saying I am a Trainee officer), no TDS certificate. one more thing to mention… I a Chartered Accountant.. will it work in my favour? In the name of proof, I have a salary account & salary certificate.. wil I get loan from LIC or should I give a try to other banks…? like SBI?

    Anil Jaiswal

    1. Hi Anil

      Please open a thread on our forum to discuss this – http://jagoinvestor.dev.diginnovators.site/forum/

  115. Pankaj Brohma says:

    Hi Manish,
    I have gone through all of your suggestion and views. I really appreciate.
    I have booked a flat in Ghaziabad which is ready to move, I applied for home loan in Axis Bank and provided all my documents and they started all of their process, they assured me that they will sanction my loan before due date but at the 11th hour they refused the loan by saying that RBI has given a strict instruction that they will provide the loan to the consumer if they will have approval and tie up with the builder …….. something like that.
    Anyway, i agreed and moving forward with DHFL, I have checked their reputation and came to know from their existing customer that they charged 3% for pre-payment and they are charging certain percentage for transferring the loan from their bank to another bank.
    I asked DHFL employees about the same and they refused that they follow RBI norm and guidelines.
    I really don’t trust them. Kindly suggest me what should I do to confirm and clarify the same. Builder is saying DHFL is the last option for me. I guess the ROI is also higher than other banks. Also let me if anyone has bad experience with DHFL

    Thanks and regards,

    1. the thing is most of the sales guys at builder site office have tie ups with these banks agents and they get a CUT ! . So is it told to you buy builder himself or just the sales guys there? Talk to builder directly on this and he will be able to allow you to go to any banks .

  116. Uday says:


    Am planning to take home loan next month. Canara bank opts for 9.95% floating loan and LIC 10.15%. which is the best option? Any suggestion canara bank?

    1. Actualyl there is no problem, just that they are not that famous and do not lie in top 5 or 10 even .

  117. Nitin Bhatia says:


    Nice Article…Just to add that HDFC Home loan is from HDFC Limited which is not related to HDFC Bank by any ways. Many people take loan considering HDFC Limited as HDFC Bank whereas both are different entities. Home Loan is always from HDFC Limited.

    Nitin Bhatia

  118. Jinal says:

    HDFC is offering 10.75% Fixed for 15 years for a 20 yr tenure. There are no prepayment charges and they are giving option of Pre EMI (under construction building) on the disbursed amount. LIC is offering 10% Fixed for first 3 yrs and then floating. What would be advisabe?

    1. I would go for HDFC

  119. Karthick says:

    Hi manish,
    I have applied for Home loan with my brother as co applicant in LIC.

    But they told that my private organization was not in their list,Hence cant process the application.
    They are not ready to accept any letter from my private organization.

    What can i do to solve the problem?

    1. I think you cant do much in this case, as its their internal policy. Too big organisation to fight for this

  120. karthik says:

    Hi manish,

    Iam looking to apply for construction loan. I am self employed. Doing interior furniture work. I don’t have IT. Other than IT i have all the necessary documents. Is there any way to get the loan? Please advise me.


    1. No there is no way .. Its really tough to get loan for self employed if they dont have ITR . you would need atleast 2 yrs ITR !

  121. Resham Singh says:

    HDFC LIMITED has pre approved my home loan. But which property I have decided, Builder is saying that our tie up for Subvention scheme is only with DHFL Ltd. What can I do now ?

    1. If bank is ready to give loan , then tell the builder that you will not take it from anywhere else !

  122. Nirmal Singh says:

    I have applied for 35 Lacs home loan from HDFC Ltd. Chandigarh without recognising any property. I provided the bank officials all documents with processing fees cheque before 12 days. No F.I. has been done by bank till date. Even I have not received any phone call. Now I want to withdraw my home loan application. how can I do it ? may bank can demand for processing fee from me ?

    1. If you have not paid anything till now, then dont worry , you will not have to pay anything . Just call the agent which you caught and tell him you are cancelling it !

  123. Navaneeth says:


    Want to take a property loan. All my friends suggest to go for SBI however pre- processing takes lot of time with SBI, seller wants the deal to be closed with in a month. Can you please suggest alertnative bank to go for?

    Thank you

    1. Try HDFC bank or LIC housing in that case

  124. rama says:

    Hi ,
    I took home loan in Mar’ 2011 from Axis at a ROI 9.5%, after 3 months it become 10.75%. You are aware that the RBI reduced its repo rate 3 times in the past 6 months, still Axis bank didn’t reduced their home loan interest rates. In this situation i want to switch from Axis to SBI. Please suggest me on this.


    1. How can we help you here .. you should make the switch now .

  125. Roopashree Shrivastava says:

    I want to switch my home loan from ICICI to SBI. Can u plz guide me on this

    1. Our forum is a better place for this – http://www.jagoinvestor.com/forum/

  126. Ritesh says:

    Could you please guide me on the home loan
    How is citi bank on home loan side, they are giving me floating interest rate 10.25 and less initial charges, but I am little afraid, if they increase interest rate after i bound with citi bank, Is any one has any experience with this bank for home loan

    They are saying that they changed their interested rate only 3 times in last 13 years. is that true?

    1. How will some one else experience help ? If you take it on floating rate, then it means that it can be increased later !

  127. Kalash Deep says:

    Hi Manish,
    I have taken a flat in Pune.So for that I have applied for the Home loan in PNBHF
    .they have provided me the Home Loan of 30 lacs with the fixed rate of interesst of 10.75 % for 10 years.Will this be a good option or should I go for the Floating rate of interest that they are providing for 10.50 %.Kindly suggest.
    And Thanks in advance.


    1. Kalash Deep says:

      Duration of home loan is 20 years. Fixed rate is for 10 years

    2. One cant decide it for you . If you are fine paying the fixed interest , then better go for it !

  128. kashinath says:

    Hello Manish,

    Which one i should prefer, Oriental bank of commerce or LIC housing finance?
    For applying home loan of 11-12 lakh.
    I’m tilted to Oriental bank of commerce for having been their customer.


  129. kashinath says:

    Well Done author. Thanks for the info.
    Have my lots of appreciation.

  130. Asif Momin says:

    I have query about service tax & VAT in maharastra, i booked flat in navi mumbai nearby ready possesion building & builder now demanded 5 % service tax & 1% vat on agreement valu i have littlebit cofusion about service tax & vat percentage. Also builder asking me give these amount in cash, please help me… thanks in advance.

    1. Asif

      Was it agreed earliar . If not, then do not pay .. or ask on our forum http://www.jagoinvestor.com/forum/

  131. ashwin says:


    could you please share the survey data to me? this is for my internal use

    thanks in advance

    1. Hi Ashwin

      I am not sure where exactly I have the data now .. We generally do not store the data for long once we publish it , what exactly you need out of it , I might try to find it out for you .

      1. ashwin says:

        Thank you Manish for your reply.

        I am currently doing internship in home loan industry where the objective is to find commonalities in the customer behavior by doing some kind of survey. Your survey details/data might be highly helpful inorder to find out the trend change in the customer behavior, if any. It would be highly grateful if you could send the data as well as the questionnaire to the mail id ashivij.km@gmail.com.

        thanks in advance

        1. Hi Ashwin

          I still cant share that data with you. I can give you some insights if you want.

          1. ashwin says:

            Thanks Manish… I will catch you later..:)

  132. Reshma A says:


    I want to take home loan of 15 Lacs. I’m having a net salary of 22,000 per month.
    Started working in a pvt. construction company from last 8 months. I want to know, whether I will be eligible for 15 lacs with around 12,000-15,000 EMI for 10-15 yrs of tenure.

    Which bank will be the best choice for me! I contacted SBT. They told like, working experience of min. 2 yrs is needed to take the loan. Whether all banks have similar conditions for giving loans?

    1. I dont think they will be giving it to you .. the loan amount might be less for you .

  133. Pratap Bachu says:

    Hi All

    Please suggest if Bank of India is good option for home loan and let me know if there any bad experiences with this bank.

    Pratap Bachu

    1. You can go with them ..

      1. Pratap Bachu says:

        Hi Manish

        Thanks a lot for your reply and i have another option to Union Bank of India, Please let me know how about this bank.

        Pratap Bachu

        1. Its a good bank overall .. go ahead

  134. Sudarsan says:

    Hi, I have a home loan of 20L in LICHFL. I have paid for 7 months. My rate of Interest is 10.7% fixed for 3 years. The Homeloan is for 20 years.

    * Pls suggest me if I can transfer my Home loan to HDFC as they tel me there is no charges for transfer of home loan, incase their ROI is less than 10.7%.

    *If not pls suggest if I can transfer to any other banks.

    1. Yes you can transfer to any other bank

  135. Hari Prakash says:

    Hi, I have taken loan from Andhra Bank and the transaction was smooth. since I had all the docs ready before I approached the bank, it was easy go for me. But the question is – I am paying Interest rate is 10.9% for 40 Lakhs for a tenure of 18 years. Is this a good deal, compared to other banks/options available in the market.

    1. That keeps changing and we dont have that info

  136. Gaurav says:

    want to have your comment currently i am having home loan of 22 lakhs from lic housing which was taken @10.4 before 8 months after 3 months only they change to 11.65 and tenure incresed from 13 years to 15 years now want to transfer is that the only way kindly suggest.


    1. Yes, you can tranfer to some other bank , what alternatives are you looking at ?

      1. Gaurav says:

        First i am thinking of SBI.

        alternate to sbi i am not able to judge which bank to go for if u can suggest any it will be good.

      2. indzara says:

        Hello Manish,

        Thanks for this really useful post.

        I was recently looking at loan alternatives and I created an Excel template for comparison of different loans based on loan amount, interest rate, period and pre-payments. I have shared it at

        1. Looks really good 🙂

  137. Kasthuri Rangan says:

    Hai Manish,

    I want home loan for flat estimate 4o lacks, emi payment 10,000 or 15,000 accepted bank?
    Please ur idea which bank Best for loan

    1. You can go with SBI

  138. Pradeep says:

    Its always best, if you go to a bank with which your property(apartments or layouts) has a tie-up with. In such cases paper work is relatively easy. On top of that if your project is approved by a nationalised bank, its cherry on cake:)

    1. Yes .. did it happen with you ?

  139. thums says:

    Axis bank seems to have the worst online service.

    There is absolutely no information of SOA/amount disbursed etc on the online portal. Also there is no option to prepay Loan online and need to go to RAC to pre-pay and it takes 9 days to reflect.

    Hopeless service and would rate definitely HDFC higher.I was unsatisfied with my earlier experience with HDFC but after getting into Axis feel HDFC is better any-day.

    Can a complaint be filled for not providing option for online part payment or is it Bank’s convenience to support it?

  140. Satyam says:


    i am planning to take home loan from Allahabad bank
    do you have any idea about that?
    will it be good?


    1. Yea it should be ok , if you are comfortable with that bank !

  141. SRINI says:

    I had applied for home load in SBI , Hebbal branch which comes under SBI Banaswadi RACPC Bangalore . The load process started in december and till date even all the legalities are correct the bank is delaying for sanctioning the loan. Now after 2 months they tell the loan is sanctioned and than till some processing ids there .. on other side the land lord is demanding to register the property.. A VERY BAD BANK TO GO FOR LOAN. DONT GO FOR IT EVEN THOUGH THE INETEREST RATE IS BIT LOW. THE PAIN THEY GIVE INITIALLY MAKES YOU TO FRUSTRATE.BETTER TRY WITH OTHER NATIONALISED BANKS

    1. Yes , this is the issue with SBI 🙂

  142. ash says:

    Dear Manish;
    What is the criteria for getting the House Loan on Society houses from SBI

    1. There is no generic rules like this. It would differ from place to place and project to project . It should fit their rules

  143. Deepak nair says:

    Hi Manish,

    I take a home in indore and apply for home loan in 2 banks union bank and oriental bank of commerce but both bank reject my application because my company not deducting PF from my salary . so is it mandatory to have a PF account for home loan ?

    and now i am planning to take home loan from HDFC please give me your suggestion should i go for HDFC ?

    Deepak nair

    1. I dont think there is a reason like this, there can be something behind that ? It might be because you do not have any networth right now ? I guess it has to do with your Credit report .

  144. Sreejith says:

    Hello Manish,

    I’m planning to take a loan with LIC, they said new scheme called “LIC Bhagyalakshmi” is opened till 31-Mar-13.The rate of intereset mentioned is 10% for the first two years and floating rates thereafter.Kindly advise if this is good ? or should i approach SBI ?

    Kindly revert.

    1. Does LIC give loan like this ?

  145. Raman Kamboj says:

    Hello Sir,

    I have applied for Home Loan (for Extension) to Axis Bank before 4 months, still it is pending. Their documentation list is like anything. I have given almost every document Mortgage 1+1, Form No. 16, ITR, Salary Slips, Approved Map,Valuation report, Bank Account Statement etc. Then they said you have to provide detail of last 12 years Mortgage registered. It was a big thing for me, some how i collected that also . From last 4 months i had spent around Rs. 35,000-40,000, still looking their faces to sanction the Loan. They have taken 4 months in documentation verification itself & still its not confirm will they sanction or not. I am completely eligible for the amount i have applied.
    Well, hoping to happen better.
    Please if you suggest me some other bank, where i can applied.

    Raman Deep.

    1. The documentation will surely be an issue … Most of the banks will go for deep checks . Better check on our forum if its normal or not – http://www.jagoinvestor.com/forum/

  146. Krishna says:

    I see a straight advantage going with the bank which needs full documentation is always better as they also verify all the documents for correctness. If your builder (in case of an apartment purchase) deviates in the construction; you will get to know easily. Its always useful to know the issues in the construction deviation; which might further help you in deciding to purchase the property or not.

    1. Thanks for sharing that point !

  147. Charanpreet Singh says:

    Home loan process was like a nightmare. Lacks cross verification of the basic details. Everybody cares about own job allocated to him, nobody cares about customer’s problems. Even seniors like Sales Manager did’nt even try to understand my increasing problems due to delays. Took a week for verifying the address in map with registry. Wasting another week for explaining details and for previous registries. I tried explaining that I may loose biana of 16 laks due to delays. He was least bothered as if he was the richest person on the earth and 16 laks was a small amount for him. Took another 4 days to find that the biana given weeks ago had a bigger amount. Why did they not tell me, when I gave them the biana. This is very simple exercise that biana should not be larger than the amount of registry. At last, I had to stay in the branch for one full day to get the things done. They made me drive 50 kms a day to get the pending docs. I dont recommend anybody to go for AXIS Bank for home loan

    1. Thanks for sharing your experience Charanpreet !

  148. Niti says:

    Hi Manish,

    I am planning to take HL @15L. I am preferring SBI. Can you please tell me how much time they take to sanction the loan.

    and Do I need to pay any pre loan payment for that?
    Can I pay n a early basis?
    what is the current interest rate after RBI revised?

    I have foubd ur article ur compact and useful. Thanks for the reviews. Please share me the details…..:)

    1. SBI is one of the best options, but getting a loan from them is not easy, you need to have very strong paper work and lot of patience !

  149. navin kumar says:

    i am looking for loan amount 60L for purchase of underconstruction property of unitech in Resale( possession in approx. 1 year) in Gurgaon.Kindly suggest pros and cons of each bank for assumed loan. Pl. be fast,i have to take early decision

  150. Funyray says:

    Can you tell me how is Punjab National Bank Home loan as compared to HDFC.

    1. Overall HDFC is more popular and better features

  151. Parry says:

    My loan is less than 20 lacs. However Axis Bank has maintained my lending rate @ 10.75% for a 20y term. Is this high considering special subsidy offered to loans below 20 lacs. Is it worth moving to SBI and what charges will i have to incur.
    Note: My flat is still in construction stage and 70% has been disbursed by Axis to the builder.

    Regards, Parry

    1. Why didnt you enquire about this at the time of loan disbursment ?

      1. Parry says:

        Hi Manish,

        My loan had got approved last year around March’12. At that time this rate of interest was reasonable and this was lower than what offered to Axis Bank customers requiring loan greater than 20 lacs. Under the current interest rate scenario other banks especially SBI have reduced their rates while Axis is being very rigid and has not reduced the base rate till now.

        So wanted to understand under the current base rate (and < 20 lacs subsidy) situation is it worth shifting.

        1. I am not sure if you can now get the subsidy part ..

  152. Sunil Chaudhari says:

    hello friends
    I have home loanif Axis bank for 25 lakhs but only 14 lakh is disbursed till date.
    Only Pre-Emi (only interest) is getting deducted from my account.
    Now I have applied for home loan in SBI which is sanctioned today.
    I wish to transfer loan from Axis to SBI,I want to ask whether axis bank will chanrge me something for this transfer because I will foreclose it with help from SBI not with my own fund? one of my frnd told me that if i foreclose it with my own fund then only I will not be charged anything, otherwiese I have to pay 2% of 14 lakh.
    Please help me on this.

  153. Ramesh says:

    Dear Manish,

    My native is Tamilnadu, what you think about the Co-operative bank? is it good for home loan.

    And one more thing can you please give me the current interest rate for home loan in SBI and CITI bank. 26-01-2013


    1. Yea why not .. if you are ok with their terms and conditions then go ahead !

  154. Jeetendar Sharma says:

    All I wanna say is …. Wowww Manish Chauhan,
    Good to see there are people like you who are helping even strangers for no returns.

  155. Namith J says:

    You seem to be very biased towards public sector banks.

    When the rate/fees are almost the same and customer service a thousand times better in private banks (especially banks like HDFC) why would anyone to and bear the sarkari brunt of babus at SBI and the like.
    IMO SBI has a lot of hidden charges as compared to HDFC/AXIS (have first hand experience on this matter).

    1. Namith

      I have just displayed the results of the survey taken by more than 1000 people . Why do you feel its biased, Its not my views anyways

  156. Monu says:

    I want to take home loan but due to some technical issue in property, only Canfin homes ltd is ready to give home loan and no other banks are offering me home loan. Can anybody please suggest me that should I go for this bank or not? Does anybody has any past experience with this bank? What are the advantages and disadvantages of this bank?

    1. I have never heard about it .. PLease ask on our forum for others suggestions – http://jagoinvestor.dev.diginnovators.site/forum/

  157. sanoj says:

    i am planning to go from lic housing finance ltd home loan,
    can u pls suggest manish from below option by lic hfl which one is best, home laon tenure is 20 years

    1)10.25% fix for 2 yrs,

    2)10.70% fix for 3 yrs,

    3)10.95% fix for 10 yrs,

    1. Prabhakar says:

      I am also in the ssame situation. Did you get any answer?…

  158. Prathab says:


    I am planning to construct a house in rural area. The budget is 25Lakhs. My salary is also eligible for that amount. But if I enquire in banks(I contacted SBI and HDFC), they are agreeing only for 15L, stating there is a separate rural quota where the loan amount given will be less than compared to a city .

    Please suggest is there any other way to manage the additional cost?

    1. I think thats the way it works . Being a rural area, they obviosuly will that restriction . All you can do is talk to 2-3 more banks and see which one gives you higher amount.

    2. I think that’s the way it works . Being a rural area, they obviosuly will that restriction . All you can do is talk to 2-3 more banks and see which one gives you higher amount.

  159. Prathab says:

    Hi may I know what is the interest rate in for home loans in HDFC and AXIS bank? Which is the best for home loans?

    1. The accurate figures you can get only from the banks

  160. Shree says:


    Is it advisable to take a home loan if one has similar amount of FD, assuming HL rate is higher by 3% over FD rate(after tax)? Keeping in mind full tax breaks one gets on Principal (80C) & Interest (Section 24) in HL.



  161. Shree says:


    Does it make sense to take housing loan if one dosn’t want to break simillar amount invested in FDs (assuming differnce between loan & FD is 3% after tax)? Keeping in mind the full tax advantage one gets on home loans (both on pricipal – 80C & interest – section 24).



  162. Pankaj says:

    Hi Manish,

    Marry Christmas!!

    I took Rs. 30 lacs home loan from Indiabulls 6 months ago.
    As of now no complaint with them, still wish to transfer home loan to some Nationalize Bank ie. SBI.
    Kindly suggest is it worthy and painless.

    Best Regards,

    1. In general, I have seen a lot of bad reviews about Indiabulls, but it does not mean that every individual cases will turn out like that, if you are not facing any issues, its totally fine !

  163. Dayanand Udgiri says:

    Thanks Manish for excellent post.

    I want to know feedback about LIC HFL. They are the only one who are offering me required 80% of 50 Lacs property. But I have read some bad feedback about tgem. Like, increasing the Intereset rate and thus the tenure without our notice, no online status, no respose to calls or emails etc. Please suggest.


    1. There will always be negative and postive feedbacks for all the companies, dont over focus on the bad feedback , there are many good feedback also , apart from SBI , LIC is one of the most preferred one !

  164. nagesh says:

    Hi Manish,

    Recently i went to SBH and inquired about SBH Max gain. They told, the person should have salary account in SBH. is it mandatory?

    1. I guess so , because its linked with Saving bank !

  165. Shailesh Wagh says:

    Hi , I had taken home loan of 26.5 lacs from Tata Capital at rate of 10.5 in Sep-2011. But from Mar-2012, they changed ROI to 10.75 resulting in my tenure increase from 240 to 273 months.Now, I made part prepayment of 2,20,000 so my tenure reduced to 195 months. In TCHFL, u can make max. part payment of 25% of outstanding loan amount in a year. So going forward for prepayment in future, I may have to pay fees of 2% of principle paid. I feel SBI is more trustworthy compared to TCHFL. Should I switch from TCHFL to SBI at 10% ? Will it yield any benefits for me? A bit confused abt it.. Thanks in anticipation.

    1. Yea .. if over all benefits you get by switching is more than not-swtiching .. then just move ahead !

  166. Naresh Goud says:

    Hi Manish,
    i have 3lacs of educational loan and 1lac of housing loan with SBH bank. i have tookthis educational loan of 4lacs in jan 2007. unfortunately i couldn’t paid EMIs properly, becoz of this still i own them 3lac(even though i paid them around 5lacs in installments till now). so what i want u to ask that is there any chance to convert all this educational loan to home loan( home loan interest is low than educational loan),as my home loan with same bank and same branch? is there any other chance?. plz advice me. they are sucking my blood with this educational loan.


    1. Naresh

      It does not work that way 🙂 . Education loan is education loan and home loan is a home loan . You cant change them this way

  167. sunil says:

    Hi manish,

    I have purchases flat and registration is done after paying 10% of cost by me,when
    applied for home loan( for 12 lacs) in sbi for max gain scheme,they told to take Sbi Pre approved plan scheme which is good for me.

    Please suggest me on this

    Thanks in advance

      1. sunil says:

        Hi Manish,

        I tried to login in the forum with my mail id and but getting error like invalid user name.

        I have purchases flat and registration is done after paying 10% of cost by me,when
        applied for home loan( for 12 lacs) in sbi for max gain scheme,they told to take Sbi Pre approved plan scheme which is good for me.

        Waiting for your reply.


        1. Send me a mail to create a login !

  168. m.vasudevan says:

    please email to me this article

  169. raghu says:

    request you to provide draft letter to wave off guarantor clause for home loan.


    1. Why should a bank wave off the guarantor clause , Does it make sense ?

  170. Mahajan says:

    Q: I have taken a loan from LIC HFL in 2007 for Rs.14,00,000.
    Will it be beneficial to me if I transffered it to SBI now there scheme is 10% rate of Interest..
    If I transferred, When can I take a loan from SBI as top up or for New House property.
    Pl. suggest

    1. But how do you guarantee that your future interest rate will not change ?

      1. Mahajan says:

        What is Base rate strategy/rule declared by RBI

  171. JT says:

    I got a sanction letter from LICHFL which mentiones fixed rate as 10.25 % for two years………..

    but the floating rate mentiones only LHPLR and not the 250 basis point discount on it which i was told by their officer………

    I checked with LICHFL loan officer he told it will not be written on the sanction letter..but after two years you will get 25o basis point discount on LHPLR.

    Can anyone having loan with LICHFL confirm this.

    1. If its not written, it does not exist , simple !

  172. Murali says:

    When all banks are allowing to covert the Interest(from Higher to Lower based on current market rate) for existing customers by paying additional conversion fee. Why the LIC will not allow this?

    And also increasing the monthly EMI amount they are charging 1000+Service Tax. The same thing is not applicable in other banks. Is there any restriction on maximum amount of EMI i can increase. In LIC they are allowing around 15% increase.

    1. Not sure on that, this is purely a bank internal policy, there is no guideline on this .

  173. Deepak Temker says:

    Hi Manish,

    I was going through your blogs and have seen many questions and your answers.

    My query is i am planning to buy a Flat of 30 Lakhs.
    I paid 8 lks to builder and made an agreement. Rest amount i am planning to go for loan.

    For remaining 22 Lks, how much loan i should apply for? and does the bank gives me 22 lks of loan 100% or i need to apply for more.

    1. They will give you around 80% of the home value ! .. so 22 lacs should be good to get !

  174. leena says:


    I have applied for home loan from HDFC for around 26L. Since I have classic bankinf privilages with the bank, they assured me that they will support me with faster loan processing.
    In all , it has taken me a little more then a month’s time for the processing. Today I had one person from HDFC visiting me and saying that I have to visit HDFC ltd to complete the loan verification process.
    For this I should be carrying with me all the original documents for verification, pay 0.1% of the loan amount as fees for Stock Holding Corporation of India.

    The interest rate is floating at 10.25%, processing fees is Rs.11236.00/- with HDFC Ltd. The term of loan opted by me is 10 yrs, so the EMI is R2 37616.00. They have also provided me with the option to go for 80% of the property registration charges as loan- which I have accepted.

    One surprise for me today was that today the person designated as a interface between HDFC ltd and myself in his discussion today asked me that from when I would be paying the EMI/ I told him that I will start paying as soon as I take the disbursement. He told me then you have to pay EMI interest charges before staring your first EMI. To this I asked him, why I should be paying EMI interest on 1st EMI when I can start paying EMI immediately. He started telling me that during your interaction with HDFC ltd with original documents you discuss this with manager. This was a total surprise to me……interest on first EMI.

    is this a ploy by the bank to collect some additional interest when the person is ready to pay EMI immediately ?

    In all the entire processing from the date of filing the application is running from 10th of October and still this is continuing….

  175. Siddharth says:


    Can u pls forward the excel to my id. sidukamal@gmail.com

  176. Bharath says:


    I have a question for you. Is it worth to construct a house by spending 18 lakhs(through bank loan) for rental income of 8 to 10k per month? Please advise considering the tax benefit on principal and interest amount.

    1. You need 10 lacs to generate the income of 8-10k in these times , so now you tell me if thats worth or not !

      1. Bharath says:

        Thanks for your repsonse. It’s worth as I will not be investing money from my pocket.

  177. surjita says:

    sir i opted for SBI home loan but they have asked so many documents and now mu builder also get irrited and not ready to give any documents.Sir please tell me which bank i can opt now as my situation is worst , m in dilema what to do and now lots of money is taken by builder as an advance.Please advice me its uegent as i i ve to pay the money to the builder now and the time duration given by him is also very slow now.

    1. There cant be just one bank which can be suggested here . Obviously bank will ask for all kind of documents , you should have enquired for that earlier itself !

      1. sanjita says:

        sir in my experience SBI has verfied all the documents but in one document the year is dtails is wrongly mentioned i.e inspite of 1980 it is mentioned as 1981 except this all the documents are clarified but now the lawyer is asking dor the rectification but as such old document i dont know how to make it corrected and they are not giving any solution that how how it can be clarified.While builder is ready to give affidevit for that in spite of that the lawer is not listening and returned the file.Kindly suggest is there any way how i can get approval or how can i correct the year details.

  178. Prathab says:

    Hi I am planning to take a home loan from SBI. They are asking me to submit last 3 years of Form 16. But I have only last 2years Form 16. Is that fine or are there any chances for rejection?

    1. Depends on the loan amount and your other numbers like salary etc .

  179. JT says:


    I am planning to take 30L housing loan for a flat of 50L. Stuck between HDFC, SBI and LICH.

    The flat is on name of land owner and its 85% completed and hence

    1) SBI is saying to do registration of full amount of property value. (around 3,24 L)
    2) HDFC is insisting on making registration on gov guidance value(23 L) first before releasing the loan (2 L). Hence loan EMI will be full even if construction is 85% complete.
    3) SBI is asking also asking to provide guranter or take loan insurance(premium 75,00,000 for 5 yrs).

    Floating Rates offered

    1) SBI 10 % (total loan processing cost 12500 – including gov stamps, processing fee, tech and legal advise etc)
    2) HDFC 10.25% (total loan processing cost 12500)
    3) LICH 10.75%

    Have i made a mistake by buying land owner flat in the apartment ?

    Is it mandatory to do full value registration with SBI incase its land owner flat ?

    1. JT says:

      Sorry premium was 75,000 for loan insurance

  180. Vinutha says:

    Hi Manish,

    We are constructing a house for which we are planning to take a loan. The property is in my name and I am a house wife. We enquired with SBI regarding this and they said loan will be sanctioned in my name and my husband will be grantor. Please let us know if my husband will get tax benefits as he will be paying the entire loan.


    1. I dont think so , guarantor does not get any tax benefit like that . Only the person who is primary loan taker gets tax benefit, also the land + house should be registered on his/her name .

      1. Bharath says:

        You have an option to add your husband in land title deed. There is some prescribe procedure and you may have to spend few thousand for that. we have done that(spent around 6k including lawyer fee), pls check with lawyer in your area or contact sub-registrar office.


  181. Arihant Jain says:

    Hi Manish,

    I really appreciate all your effort to write detailed blog home loan and clearing doubts in every individual mind who is going for a home loan.


  182. Ashish says:

    Hi Manish,

    Just wanted to get your view on my situation.

    I got the Loan from LICHFL at 10.65% (Floating) last year Septemer and I have checked that currently they are charging me the same interest rate.

    Upon asking Agent told me that LICHFL follow procedure of calendar year that my loan interest rate cannot get changed before April 2012, I just followed up with them today, he said from November it will be changed for me.

    As per me for the Floating Loan, if the Market Interest rate got changed, they should change the interest rate for my Home Loan. Please confirm or correct me if I am wrong..

    1. But at what time they will change has to be defined in their terms and conditions, which I think is new year . So they seem to be under terms and conditions only, better follow up on our forum – http://jagoinvestor.dev.diginnovators.site/forum/

  183. surjita says:

    dear sir
    every one is telling its better to go for private sector for bank loan but after reading ur blog i wanted to go for nationalised bank only. But now i am confused between SBH & SBI. Which is best sir, kindly suggest,its urgent. Also tell me what is mortagage charge and all as i am totally unaware of it.

    1. Surjita

      I suggest go with SBI bank if you want to go with public banks

  184. neeraj says:

    dear manish
    i hav a home loan from SBI under “easy home loan” scheme in this the interest was fixed fr three years and now it is 12.5 I want to switch over to a new scheme which is having a lower rate of interest in sbi only. but i am not sure about the switch over fee SBI people say it is .5% of balance amnt and apnapaisa.com says it is rs 1000
    can yoy help and provide some info in this matter.

    1. Neeraj

      A better discussion can happen if you open a thread on http://jagoinvestor.dev.diginnovators.site/forum/

  185. sudhir says:

    Hi Manish and Readers,

    which one is better option among the LIC and PNB for seeking housing loan.
    In terms of interest rate, processing charges, no hidden charges/penalties.


    1. Sudhir

      There cant be just one answer always . Note that it also depends from branch to branch and case to case . Both are good . If possible , try with SBI first !

  186. Sudhir says:

    LIC Housing is offering fixed intereste rate of 10.95 % for 10 Yrs where as other are offering floating rate of 10.40 % for 40 L which option would be better

    1. That would depend on your view on the interest rate in future, if you want to be fixed with 10.95% for next 10 yrs, then choose the first one

  187. Vijay says:

    Hi Manish,
    Thanks for this informative article. I was in confusion to choose between PSU bank and icici. Now, its clear for me. I go for PSU bank.

  188. Bhavitha says:

    Dear Manish,

    We are planning to buy an under construction flat, which will be handed over in 10-15 months time. The sale deed was done for 44 L. We have paid an initial advance and are now seeking a loan. We plan to take a loan amount around 28-30 L. In the worst case 25 L. With my take home sal being 47K, I was told by the Axis bank guys that I am eligible for 25L only. So, have added my husband also as co-applicant.
    With that backdrop, we are now confused about which bank to go for among Axis/HDFC/SBI. Both me and my hubby have sal accnts with Axis, so we thought our processing would be a lil easier here and also the factor of bank’s trust on us would be better. But as we started the process, like one of the below comments on detailed analysis on Axis’s process, we started facing petty issues already right from the multiple stages of documentation instead of one time, too many errors in filling forms, etc. etc. Fingers crossed and waiting for the result on approval/rejection and the amount if approved.
    Also, we have HDFC in mind as our builder has tie-up with it and says he’ll handle the non-sense with the process.
    But as we started researching on the interest rates and the aftermaths of home loans, we are thinking on processing with SBI, but are skeptical about the amount of loan to be sanctioned might be very low compared to the other two.
    I have couple of questions in this regard and request you to kindly take your time to answer them:
    1) Can we simultaneously process the documentation with 2-3 banks, go through their credit scrutinies and check their sanction amount and then decide to select the bank? Will this have any negative impact on my trust worthiness with the bank?
    2)Or, Should I wait for each process to be done completely and then go with the other banks processing?
    3) As per the sale deed, 80% of it comes to 35L so can pursuade the bank to increase the amount?
    4) My husband and I have CIBIL scores of 800 and 775, and also do not have any delay in payments, never in the past. So, can this mean we have a good credit profile?
    ( The reason for this question is, i have few credit card EMIs pending which will be over in 3-4 months time, but are currently shown on my CIBIL report. Just want to reassure that these will not effect my loan.)
    Thanks a lot for your read and would greatly appreciate your reply.

    1. 1. Yes you can go with multiple banks , but the point is all of them will charge you the token amount , are you ready to pay them that processing fees. and this will be reported to CIBIL , at one time if you have multiple enquiries, it will not be a great thing on your cibil report.

      2. Yes

      3. I doubt they will do that

      4. You score of 800 is good , 775 is also ok , just make sure you do not have any DPD number, SETTLED and WRITTEN OFF remarks on your cibil report. Your credit card debt is not a good sign . first pay it off and let it get removed from your report , then apply for loan .

  189. Ghodke says:

    Dear Manish,
    I am planning to swich home loan from LIC to SBI. LIC is charging me with Floating rate of 11.65%. SBI is offiering me 10.25%.
    Whether SBI will stick to this 10.25% with small variation or it will also raise interest rate. In other words whether this difference of interest rate (1.40% ) will widen or reduce in future.
    Also can you tell me maximum floating interest rate SBI has charged in last 10 years.

    1. Obviousy it can raise if the interest in market goes up

  190. Rizwan says:

    Dear Manish,

    I am planning to purchase a 2 year old flat that is purchased with lichousing loan by the seller, can I ask the seller to close his loan and I will start fresh loan process or is there any way I can transfer exiting loan to my name? please advice.


    1. You can transfer the existing loan i guess, but you will have to ask on our forum for this http://jagoinvestor.dev.diginnovators.site/forum/

  191. sachin sharma says:

    Never ever try to get a home loan from axis bank. They are the worst. forget about any phone services after loan. you have to go to their branch everytime theyu send you some flase penalty.. ECS never works and they blame and penalize you for non payment through ECS. All of the world is using ECS they are the only special.

    FRUSTRATING…… THEY ARE THE SAME BANK WITH PUBLIC SECTOR ATTITUDE OF 1970’s .. if you dare u will be feeling cheated like me.

    1. Thanks for sharing your experience with us

  192. Piyush Awasthi says:


    I am planning to take Home loan from LIC Housing.My In hand salary is around 42000 and I require Home loan around 28 L..So after discussion with Agent,they are offering 28 L after saying that i am eligible of 22 L and another 6 l can be sanctioned as Furniture loan.Can u pls suggest if this kind of feasibility exist or their might be some other story.

    1. I think you should enquire more on this , because agent will get commission on 28 lac, so that might be telling you some stories .. you might not get tax benefit on full 28 lacs in that case . Discuss more at http://jagoinvestor.dev.diginnovators.site/forum/

      1. Piyush Awasthi says:

        Hi Manish..Thanks for your reply.can you pls suggest me the right authority to contact for this…..

        1. It would be bank only . Check if they are aware about this way of arrangement

  193. Pavan says:

    Hi Manish,
    great job .. and i really like your post .. it is very useful,
    please help me with below query..
    I am planning to take Home loan from Canara bank as builder has some tie-up with Canara bank, and i am not able to find out any positive or negative reviews on Canara bank Home Loan .. Please let me know if you know something about this.


    1. It should be ok , Canara bank does not have many customers, so it would be tough to find much reviews !

  194. surjeeta behera says:

    I just wanted to know is there any difference between intrest rates or the documentation between SBH and SBI AND HDFC. which is better SBH or SBI OR HDFC

    1. Definately there will be , as they are different organisation , there has to be . But the major things will be same .

  195. Mrinmoy says:

    Sir, I want to take a home loan from SBI. For the last 6 years, I was working under MoD upto Oct, 2011. After that, I joined MHA in another post and in between the red tape hassle, I could not submit my Income Tax this year though I am very regular from the beginning regarding this Tax payment. Now my question is that, without submitting that document of tax return for the year 2011-12, am I able to get a home loan from SBI? Now I am working in a gazetted post in Central Govt.which is yet to be permanent within a year . My salary is 4lakh per annum.

    1. Sathish says:

      You have choosen good bank SBI is better for home loan. Check with the near SBI Branch Field officer, He will explain you what all the things required and guide you in good way.

    2. I dont think it will be easy to get a loan without tax return !

  196. ajay singh panwar says:

    sir my father want to take home loan
    he is govt employee doing job in income tax dept. rajsamand rajasthan
    his monthly salary is 17000/- and from other source 3000/- so it 20000/-monthly but just 7 year left in my fathers retirement we want to take 13-15 lac rupees loan so plz advise we which bank is good for us ? and how much amount will be passed to us ? or any other advise ??

    1. I think upto 10 lacs should be issued

  197. Pratima says:

    I wud like to know that I have taken loan from Axis bank during Jan, 2012 and not even completed 1 year and full loan amount (sanctioned Rs. 22 lacs) and disbursed till date is Rs. 15 lacs and balance amount still to be disbursed.

    If I want to trfr it to Public bank, whts the step by step process and is there any charges for transferring now as full amount is not yet disbursed by Axis Bank.
    Whether its time consuming process.
    Pls reply

    thnks & regards,

    1. Pratima

      I think it better be discussed on our forum – http://jagoinvestor.dev.diginnovators.site/forum/

  198. AMIT says:


    1. Yes , you can get loan frrom them .. and yes PAN card would be required I guess !

  199. Rajdeep says:

    Hi Manish..
    your article was very informative..
    I have a query…
    After passing out from College, I joined Govt. of India as a group B officer on March 2011. I am posted in Mumbai. Presently I am undergoing my probationary period of 02 years, meaning I will be permanent at my job 0n March 2013.
    I am staying at a rented apartment in Mumbai and feel that the rents in Mumbai are are so high that they take a huge chunk of my salary…leaving me with no scope of planning other investments. Hence I am planning to buy an apartment in Mumbai, which will not only save my monthly rent but also will be a good investment.
    Now I have already selected a 1 BHK apartment in Badlapur (W) (near Kalyan) and planning to buy it soon . However since I am still in probation, I guess most banks will not grant me any home loan. Hence can you kindly suggest me if there are any banks that may offer me home loan at this stage (I have only one Form-16 to show for the financial year 2011-12).
    I am kind of desperate to buy an apartment now because it may not be a good idea to wait for my probation period to end as property prices in Mumbai exponentially.
    So please help me out..

    1. It will really be tough to get a loan with just one year of Form 16 . You need atleast 3 yrs of ITR for that .

  200. Gopi Krishna Settur says:

    I have taken hoem loan from IDBI bank in Indira nagar bangalore and it is okay in terms of service and i was told by the agent that it is mandatory to take the insurance policy. any way remembering AXIS bank forced selling i dont want to comment on that.

    while prepaying the home loadn, always opt for “reduction in tenure of the loan” not reduction in the EMI.

    in my case iam paying 30220 INR as EMI for my loan. when i approached the bank with 2 lakh rupees to prepay they offered me whether to go with “reduction in tenure or ” redeuction in emi” and reduction in EMI becomes 29K which makes no sense.

    hence i chose to first option and got 3 years reduced

    1. Thanks for sharing that 🙂

  201. Girish says:

    I get home loan only 1800000 for 25 years with SBI and same amount LIC housing give for 20 years which is suitable for me suggest it.

  202. navin kumar says:

    I am looking for loan of approx. 60 lacs and from thread SBI seems to be best option.Kindly suggest on

    a. What should be tenure of loan. 15 /20/25/30 years. I may pay EMI based on 15 years as well as 30 years. But,I am thinking to have loan for 30 years assuming that my monthly emi commitment would be low and I would pay more than EMI , whenever i have surplus money. Kindly suggest pros and cons of 15 and 30 years loan.
    b. What bank may be best for this loan
    c. ICICI and HDFC are offering approx. 140% of registry amount.and i don’t know abt max. permissible limit set by SBI.Is there any way that SBI pay more than 100% from registration amount of property

    1. I dont think 30 yrs is a good idea , 20 yrs if ok .. what is the difference between 20 yrs nad 30 yrs EMI , it wont be very high . Go for SBI if you can get

  203. Krishna Murari says:

    Dear sir,
    I want to take home loan of around 17 lac. I have approached HDFC and SBI.
    HDFC rate is 10.5% and in SBI it is 10.25%. But at present I am undergoing training in IOCL so SBI is refusing and saying that loan can be given after confirmation only.
    But HDFC is ready to give. So I had to go with HDFC only.
    I have following queries:
    1. EMI comes out for 20 years is around 17k and for 10 years it is around 23k. I am planning for 10 years but HDFC people are refusing for 10 years and saying in that case loan amount will be decreased. So does it make any difference that in one case I took loan for 10 years with 23k EMI and in another case 20 years with 17 k EMI and additionally pay 6k per month extra to loan? and which case is beneficial to me?

    2. Presently they are saying that there is no prepayment charges so if I want to switch over my loan to SBI after one year than in that case any charges will be given to bank?

    3. One more question sir, Lets say I am prepaying 1 lac rs. after one year than my loan period will be reduced but the EMI will be remains same.Is there any calculator that can calculate that how many EMI will be reduced ( that means what will be my new loan period) after paying 1 lac after one year

    1. Krishna

      1. they are not allowing for 10 yrs, because as per their chart, you can not be allowed for than X amount per month ..

      2. You will not be charged for prepayment

      3. Yes there are calculators like that in internet

  204. Ajit Singh says:


    I have booked a property recently. And seeking for a home loan. At present I have two options 1) Co-oroporation Bank 2) Hdfc bank

    Can any one suggest that home loan from co-orporation bank is good or not. Presently they offering @10.50 + processing fee wave off for few times. But don’t know the interest rate once scheme will over. It’s a long term loan for 20 years so do not want get any thing wrong. Also how reliable are they.

  205. shashank says:

    I am looking for 25L with tenure of 10years joint loan with my mother.loan was offered by LICHF,Bank of India.SBI is not providing.
    Bank of india:10.5% floating with no processing fee but approx 12K stamp charges & extra.
    10.75%3Year fixed further floating,
    10.95%fixed for 10Years
    I feel after above discussion to move with LICHF,Now Dear Manish can u suggest me to go with LICHF of 10.95%fixed for 10 years or floating option.
    please suggest me soon as i want to confirm withinn two days…
    Thanks buddy…& its an excellent social awareness done by u..

    1. I cant recommend personally . It all depends on your trust and overall feel you have got. Based on above table, it would be a good move I would say .

      1. Kiran says:

        Hi Manish,

        Even we are in same situation as mentioned by shashank. Could you please suggest if 10.95 fixed for 10 years is good option or do you see an decline in interest rate in forthcoming years. Will next assembly election have any impact on interest rates?
        Waiting for your valuable inputs.

        1. I cant comment on interest rate like that, no one can , better not get into that kind of conversation 🙂

  206. RAJESH says:

    Dear MANISH,

    Please revert, Can I shift the existing SBI Home loan to SBI Maxgain?

    1. Mostly yes, some people might have already gone through that, read http://jagoinvestor.dev.diginnovators.site/forum/how-to-maximize-the-gains-in-sbi-maxgain-homeloan-account/2635/ . Also ask your specific question on forum if you wish

  207. Puneet Malhotra says:

    Hi Manish.
    Great Article – exactly what i was looking for as a new HOME LOAN seeker.
    Just one query – i have heard that sometimes SBI makes delay on fund disbursement to the builder, in turn the builder charges the customer (that would be me) high interest rates.
    Have you heard about any such complaints from others regarding SBI.

    1. I cant recall that actually. WHy dont you discuss it on our forum , you will get many views on this – http://jagoinvestor.dev.diginnovators.site/forum/

  208. Ningthemm says:

    Hi Praveen ,
    In one of the comment you have mentioned as follows.
    In the below comment, what actually do you mean by “amount as in the sale agreement”?
    Also with SBI, the property should be registered for the same amount as in the sale agreement even if its higher than the government guided value ( which is the case mostly ), does avoiding black money generation etc….. But with LIC, you can register your property for a lower value than your sale value.
    I am not clear on this . Say I have to pay say 50 lac , excluding registration to buy a flat. Which of the following do you mean ?
    1. For SBI, Registration amount will on the 50 Lacs (ex : 6.7 % 50 Lacs) ?
    , For LIC or others, registration on a amount lesser that 50 lac is possible (ex: 6.7 % 29 Lacs)?


    2. The entire 50 Lacs is/can be written in two agreement i. Slaes agreement , ex 28 Lacs and ii. Construction agreement , ex 22 Lacs
    If this is the case,
    in SBI, registration should be done on sales agreement value (28 lacs here ) , so 6.7% of 28 Lacs , In case of LIC, registration can be done in much lesser that sales agreement value. Say something like 6.7% of 20 Lacs ?

    Can you/ Manish please explain. Waiting for you urgent reply.


    1. Better put this comment under Praveen comment , by click on the “reply” button there. Other wise he will not get the intimation

  209. Sudhakar says:


    I took home loan from SBH for amount: 3860000.00 @ 11.25 Interest for 19.5 years. My EMI was calculated to 44000 but still not sure how it was calculated because I use many of other banks EMI calculators and still find it as incorrect EMI amount. May I know if I am paying correct EMI or it requires recalculation ?

    1. Sudhakar says:

      sorry interest rate was 11.50 %

    2. You might not have considered processing charges and teaser rates (incase you had less interest for starting years) , Just see if it was very near to the amount which was the actual one .

  210. p diwakar says:

    dear sir,

    I had asked that I should shift from “LIC Home Loan” to “SBI Max Gain”.

    My LIC Home Loan : 11.15% , Fixed for 5 years
    Loan Amount = 26 Lacks.
    Year : Nov,2011

    If I shift from LIC to SBI Gain, then LIC charges 2% of the balance loan amount which is 52K approx.

    Total Charges from SBI : 18.5 K Approx, which includes:
    – Search charges, Evaluation, Processing Fee, Stamp Duty, Registry Mortgauge etc…

    I just wanted to know if i should still go for this switching? The Total amount I would need to pay is 70K, for this conversion.
    FYI,I would surely go for 1.0 Lacs prepayment every year, along with additional 5K/month part payment, which could be irregular but can 30-60K additional.
    Else please suggest which should I opt?

    1. If you are going to prepay 1 lac and then some amount every year, the loan duration will drastically come down. I think you can do for it

      1. P Diwakar says:

        Dear Manish,

        Is there any flexibility that LIC provides for converting from 5-years fixed 11.15% to 3-years fixed 10.75% ? If yes, then any conversion charges?
        I have done 11 months payment, so i want to explore if above conversion is possible and beneficial?
        Else as you mentioned before, that I can think to shift to SBI-Max Gain, which will be more beneficial…
        Other than my previous point of min 1.0 Lac definite prepayment, I want to mention, that it is probable that I would sell the current Home, for which my LIC EMI is going on. The Home purchased was 32.5 Lacks and i probabally would sell it in 37-38 Lacks in begining of next year or else 42-45Lacks in 2014.

        Please suggest in this case, whether i should shift to SBI Max Gain with 70K overall conversion expenses? Or I should retain the same 5-years fixed LIC plan?


        1. I think this question is more suited for our forum – http://jagoinvestor.dev.diginnovators.site/forum/

  211. Prashanth says:

    Can some one please share the experience with IDBI home loans? I had a good experience on my current balance transfer from ICICI that I took up 2 yrs back. They also have daily reducing balance on interest like SBI; processing hassles are not there like with SBI – everything done at our dor steps; Why is it that they are not so pupular in this forum or even in media? I am planning to go to them for my second home loan….any advice on a better option please?

  212. Aditi says:

    For the LIC Housing Finance product. I found that all fixed products are not the same. Basically the difference is in the plr – discount that happens after fix period ends. In case of HDFC you are worse off by 0.25% as compared to floating rate once the fixed period ends. In LIC I think you are some 2.5% off ! Request you to confirm.

  213. Aditi says:

    Reason for this is that after fixed period ends the LIC rate jumps up to more than 13% according to todays rate calculation. If you check up on moneyivy.com the interest rate for LIC under fixed option is shows as fix rate after 3 years also. Of course you can always do a balance transfer after fix period.

    1. Aditi , your comment is for which sentence ?

  214. Aditi says:

    advise you against LIC Housing Finance as a product

  215. Hardeep says:

    Hi All,
    I am taking LIC home loan.. applying tomorrow,

    should i take 10.7% fixed for 3 years OR
    10.75% Floating

    Please suggest. I think interest rate can go down in near future but may rise later..

    1. If you are taking it for long term , you can not predict it for short term or even long term

      1. Hardeep says:

        i am planning for 15 years period

        1. Yea its a quite long term , predicting how the interest rates will move is more of less a futile exercise

  216. Karthik says:


    I am planning to buy Home loan around 20 Lakh. As my home document is there in Corparation Bank, all loan approval process becomes very easy(no legal or Technical fee required). But I personally did some research on different home loans and liked SBI as they have Daily reducing balance and I can get better interest for parking my money in that loan account.
    Does same feature also available in Corparation Bank home loan?
    Can anyone propose good option to opt for by making some comparative analysis on SBI and Corpation Home loan?
    Also do we have same Life insurance concept to take loan from Corpration Bank?
    Is processing fee more in Corp bank? Can any one comment on overall feedback on Corp Home loan?


    1. Karthik

      I think this needs discussion and better ask it on our forum http://jagoinvestor.dev.diginnovators.site/forum

  217. Ganesh says:

    I am looking for a homeloan for 45-48 lakhs for a tenure of 20 yrs. HDFC has come out with a new home loan plan on 15th August 2012 called trufixed and they offer 11% fixed for any period between 3 yrs to 10 yrs (customer has option to choose the no. of years he wants to be fixed). Their floating rate of interest currently is 10.75%. Interestingly, there is only 0.25% difference between floating & fixed. Can you suggest me if going on floating is wise at this point of time or I should opt for truefixed rate e.g 11% fixed for next 10 yrs.
    Looking forward to your early response.

    1. Genesh

      I dont think fixing at 11% for so many years is a good idea, the interest rates can go down also , or up also , if depends if you want the security of interest rate fluctuations or not !

  218. Aditi says:

    I have found that the information offered on many sites on the internet is very inaccurate especially some of the google search results that come up promising very very low rates. The site mentioned here deal4loans does not really have accurate information as the slabs mentioned by banks are not the same as those on site. Mainly its a site that sells leads. Most sites on internet just take your number and magically lots of agents start calling.

    I have found 2 sites that give me really authentic information: http://www.bankbazaar.com and http://www.moneyivy.com .I used both services to get complete picture of home loan rates ( as both sites have slight difference in their bank partnerships). I finally used moneyivy service as it was more personalized and their advisors gave me some very good advice ( although both sites are very good at information)

    1. Aditi

      Good to hear your feedback on these sites .. Will try to get more info on this ..

  219. Nishant says:

    Hi, I am in process of selecting between SBI and HDFC for home loan. So creating list of things I should consider before taking decision.
    Loan amount: 26Lacs,
    Tenure: 20 or 25years
    Q1: Interest Rate (SBI: 10.25 vs HDFC 10.50)
    Q2: Processing Fees (SBI: 6500Rs. vs HDFC: 0/- due to salary account)
    Q3: Pre-Payment from own source (Lumsum payment) (To Be Checked)
    Q4: Pre-Payment from other lender (Transfer Home Loan)(To Be Checked)
    Q5: Pre-Closure (To Be Checked)
    Q6: Switch to lower interest rate(SBI: 1%, HDFC: TBC)
    Q7: Reducing Balance (SBI: Daily, HDFC:TBC)

    Please let me know if any other criteria I need to think of:
    HDFC Guy is saying there is no prepay or preclosure or switching to lower interest rate or lumsum payment fees, but their website says different, he said website is not updated!!
    Please suggest, whom should I choose?

    1. You question needs detailed discussion , please post it on http://jagoinvestor.dev.diginnovators.site/forum

  220. Jayesh says:


    Just wanted to know, is it possible to pre-pay the home loan with-in first year itself. If loan amount is small.

    What-if someone sells the property within first year of purchase. Are there any conditions on full pre-payment of loan in first year ?


    1. Jayesh

      That will be purely as per your bank term and conditions, read your policy documents

  221. Ravish Hasija says:

    Hi Manish,

    Need some advice here. I am taking a home loan from HDFC bank of Rs 1500000 at 10.5 floating.

    I can afford to pay the loan in 8-10 years. However, the bank representative is suggesting me to take the loan tenure as 20 years and i can do partial payments whenever i have surplus money.

    What should go for? Please advice,

    1. Ravish

      No , better go for 10 yrs only , as 20 yr EMI will have higher interest component in it !

      1. Nishant says:

        Manish, I didn’t get what you suggested to Ravish.
        Interest will be charged as per remaining principle balance (@10.5%) and how does it make difference
        Option(1) 20 Year loan => Prepay in 10 Years
        Option(2) 10 Year Loan
        I am confused as, I am also planning to take loan from SBI/HDFC 28Lacs @10.5% for 20 years term.
        as with option 1 you have flexibility of paying at your convenience rather than having higher EMI. (there should be no difference considering no prepayment fees)

        1. Nishant

          In that case you dont understand how EMI works , when you take a loan for 20 yrs and prepay in 10 yrs , its a different situation . and when you take a loan for 10 yrs , its a different situation, in first case you are paying a very high component in your EMI as interest part and your outstanding comes down very slow . In 10 yrs your Outstanding will come down by just 25-30% , not more than that .

          Read this article for better understanding – http://jagoinvestor.dev.diginnovators.site/2011/04/loan-amortization-emi.html

          Let me know if you have more questions


          1. Karthik says:

            Hi Manish,

            What about Tax saving’s from home loan? Is is better to opt for longer period just to save taxes?



            1. I dont think so , as you increase the tenure, the EMI does not come down very fast !

          2. Nishant says:

            OMG!! I really don’t understand how EMI works 🙁
            Thanks a lot Manish for informative article on “How EMI’s Principle and Interest breakup is done”
            From that article and comments, I have decided below approach. Please suggest if any correction/ better approach.

            I am planning to take 28Lacs Loan @10.25% from SBI
            I am thinking of taking it for 20years.
            EMI would be around 27486/- and I am planning to make a additional payment of around 25-30K every month along with EMI. (This will make interest-principle ratio to 45-55%, actually I will be using SBI’s Max gain scheme in which I will deposite whole salary (77K) to loan account and will use same account for monthly expense around 15K)

            As if I take 10years loan EMI would be higher and that will have higher interest component than approach decided after reading ur article.

            In this approach, catch point is I have to make sure that I make additional payment monthly along with EMI rather than making prepayment after 4/5 years.

            Please suggest if any better approach.

            Again thanks a lot for all these informative article.

            1. Nishant says:

              Forgot to add information about me:
              1) tax benefit does matter for me (CTC: 10L)
              2) I am a Bank fix deposit guy, so may not be able to get better return (>10.25%) of spare money from anywhere else.

            2. Nishant

              This needs dicussion, forum would be appropriate place to do that, i assure you will get great answers – http://www.jagoinvestor.org/files/data-sheet-jagoinvestor-putyourname.xls

            3. navin says:

              hi nishant,

              i am also facing similar dilema. I think, you must go for long term loan and try to save maximum amount in maxgain account. bcoz, loan interest is calculated on balanced loan amount. and if you check, 1st month EMI is same for long term as well as short term tenure. since in short term loan, your EMI is more,you are making more to prinicipal amount during first month(since interest part is same), making balance loan amount to lesser, as compare to long term loan., consequently less interest next in subsequent month. however, there would not be any different in long term or short term loan, if you commit for long term loan to bank and pay EMI as per short term

  222. Abhay says:

    Hi Manish sir,
    It is said that banks don’t offer housing loans for projects developed in at the border of city corporation ,i.e in developing gram panchayat area, because of unavailability of ‘N.A. collector , township plan sanctions’.
    Do banks don’t lend loans for projects in developing village areas which are outside city corporation limit?
    I faced such a problem and i’m unable to get loan. what can i do? Please guide.

    1. It might happen , banks would need all kind of assurance that things will be in control later , better you discuss this on our forum – http://jagoinvestor.dev.diginnovators.site/forum

  223. payal says:

    Hi Manish,

    My husband is 31 and we have taken a home loan for 25 lakhs in july 2011 from SBI. At that time we were told about the mandatory SBI life insurance and had to take it paying a premium of 11K/year for a period for 5 years.Now we are due to make the 2nd payment of premium and having some confusion..After reading your articles on term insurance and its importance we have decided to take a term insurance for 50-60 lakhs.but considering this sbi life insurance will be valid till our loan term(its 20 years but plan to pay it off sooner) it doesnt seem beneficial in long run..will surrendering the policy and taking a term insurance for 75-80 lakhs(ie the cover we want +loan amt) be better.kindly suggest…


    1. Payal

      The SBI life insurance was sold to you to exploit your situation, its not at all mandatory and a common tactic played by employees of the bank . You can just stop it now . take a term plan as your were planning !

  224. Nilesh says:


    Which bank is best for Home oan LIC or SBI?
    and Does the LIC(Home Loam) Is comes under government body?


    1. Nilesh

      Thats what was discussed in the article, you cant pin point one bank like this and call it best for all situation, but yes SBI and LICHF are good one’s

  225. Abhay says:

    I have heard that some bank offer lower interest rates during the year (which is open for certain period) to migrate from home loan from one bank to other. Do you have any information on this at which point these offer comes.

    1. This is generally done when banks expect a downward trend in interest rates .. There is no specific period like this, still you might want to talk in detail on this at our forum – http://jagoinvestor.dev.diginnovators.site/forum

  226. Rakesh says:

    Dear Manish,

    Need your immediate help, I selected property in Panvel while I work and live in Pune. The property is approved only by SBI till now (Builder provided APF number too). When I approched to SBI Pune, they told me apply from SBI Panvel as property is in Panvel.
    When I contacted SBI Panvel, they are telling me to apply from SBI Pune as my home and work address is Pune.
    I am really confused and feeling dejected.
    is it really tough to buy property from other city than home city ?

    Thanks and Regards

    1. I think you should do 2 things

      1. Start a thread on our forum for this http://jagoinvestor.dev.diginnovators.site/forum/ , there are so many people who must be clear about this and can give you pointers, truely speaking , I will have to find things on my own ! ..

      2. File a RTI to SBI , it comes under Govt 🙂 . So better ask them directly what is the rules and also mention what you are going through (in short) , they will give you the exact legal answer 🙂 , take it to SBI pune and panvel and show them , they will act !

  227. Kapil says:

    How is India Bulls for Home Loan, they are giving 10.75% floating

    1. They are ok , havent heard too much about them .

  228. ARUN PARMAR says:

    I have availed loan both fromSBI and LIC.My experience with LIC is far better than SBI.LIC disbursed the loan with in 10 days and i had to wait for 49 days for the same with SBI.Both instituions are charging nil prepayment charging.I think LIC is best option

    1. Is it possible to pre-pay LIC loan online ? Just a question

  229. Rajesh Agnihotri says:


    I have booked ready to move property in Indirapuram Ghaziabad, directly from builder. I have applied the loan long back with SBI Noida , I have received the Principle Approval on 01 june 2012, I have given all my property apaper to SBI like alootment letter, Buider -buyer seller agreement. I am strugling since last 5 days for loan sanction. They says two-three days , every call. I do not know what to do. I have approached to AXIS bank , i am not sure how safe I am with Axis bank as this is a private bank.

    Please advise how and where to escalate the SBI related issues.

    Rajesh Agnihotri

    1. Rajesh

      When you are taking a loan , bank should be thinking how risky u are , not you should be thinking how risky a bank is . Axis bank is one of the major banks lending for home loan, and there mostly the approval will be faster than SBI

  230. Satish says:

    I found Axis bank team and processes worth mentioning.
    1. They have compulsory property insurance clause. Its good to insure property, but they have fixed what policy and which company. For instance they have a tie-up with Bajaj Allianz.
    2. They don’t give options for EMI date. One would expect at least 2 options. But, Its fixed at 5th of Month.
    3. They don’t give reciept for processing fee, and loan agreement.
    4. Their reprsentatives are not well coached. They won’t tell you all information in one shot. They will trouble you in steps.
    5. Even after processing fee cheque debit from customer account, they ask for bank statement confirming same. Reason, their is delay of 1 week for status update within 2 internal departments of Axis bank.
    6. Customer provides 6 months bank statement while applying for loan. But later again at disbursement stage they ask for it. Why? They want to check the payment of own contribution done to builder. They insist for duplicate statement, even though the statement which is given at time of loan application has entry of own contribution. Again this is because of lack of information sharing between internal departments of Axis bank.
    7. They would demand that all cheques be drawn from same account. Its necessary that PDCs are from your salary account. But they would insist on even Insurance premium cheque to be drawn on same salary account. One cannot understand this.
    8. They are sure they would committ mistakes in filling loan application. So they take extra signatures on margins of application form pages.
    9. They committ mistake in giving account number of their own processing fee account and expect us to correct it. How does customer know a/c number of Axis bank processing fee a/c.
    10. To meet their disbusrsement targets, they would delegate actions to customer. e.g provide bank statement in order to expediate.
    11. They won’t provide you acknowledgement of receipt of Orignial agreement, Own contribution receipts, Index 2, Insurance Certificate, till full disbursement is done. Only thing you get after giving all originals is the Loan approval letter.
    12. They would insist on documents which even their legal consultant has not asked for. e.g They would ask for sale deed when they know that a Cooperative society would be formed.

    All in all, each time you will spend week for arguing on issue. If you need loan disbursement in short time, don’t go for Axis. It will take at least 1-2 for processing and getting disbursement.

    1. Thanks for this update Satish ! .. I am also seeing this same issue with Bajaj Finance for two wheelers

  231. manu says:


    I am trying to take a home loan for 20 lakhs and i have seen that sbi is charging “SBI life coverage available with one time premium & premium is also funded by Bank. No Prepayment/Pre-closure penalty charged” . I am not sure what is this and how is it charged. can anyone tell me more about this…. and they are syaing that this is mandatory. and also they have a leaga fee + valuation fee of 3000 for my loan. Shoud i go for hdfc instead as they dont have this mandatory insurance policy and no legal fee etc. I have 10.75 fixed for 3 years from hdfc where as 10.50% from sbi floating. Please advise or should i go for LIC 10.7 fixed for 3 years and no insurance mandatory and no other charges. I am really confused pls help me. As per reviews ebody is telling sbi in this site and im confused…is it because of daily reducing option we should go for sbi ?

  232. Yugandhar says:

    I have a Home loan with SBI, service wise it was always good for me. In my loan I had an option of ‘Pre-Payment’ without any additional charge. I paid what ever I can in every month, some times just INR 1000 .
    Only one problem I have with them is with the Loan statement, there is no Online facility for Loan statement , If you call customer care they can’t send you in Electronic format and i have to contact back for Hard copy, Bank says I can’t give you for full financial year.. I can give it only for tenure of April to until the date you are requesting. Which is a pain every year for me…Beign an ITian , my comp want me to submit my IT proofs in December only .. i think same case with many mncs. So I submit April-December to company which reflects in Form 16 then take one more statement and use it in IT Returns time… This may be issue with fewer branchs of SBI not across India… I explained a lot to the Officers, Managers but you know how the staff in Secondary Cities, District head-quarters behave.

    1. Yugandhar says:

      read above as ‘ Being ITian’ 🙂

      After all this I still support SBI

    2. So they cant provide the statement in hard copy even if you approach the bank and are ready to pay for the statement ?

      1. Yugandhar says:

        Hi Manish,
        They will not charge me to provide statement and If I am ready to pay for statement also they can provide statement only between April to December (, they can’t give me a projected statement (provisional fro Jan-Mar) for April to March.

  233. Prateek says:

    Hi I am planning to buy a house in mumbai and for the same i am looking out for loan from a bank. I have a requirement of a loan of about 85L. Both SBI and LIC are ready to give me that much of loan. (HDFC is not ready). So, after giving a though on both the offers (LIC and SBI) i choose to go with LIC. I tell you the reason for my selection, please help me in finding out if my decision seems correct to you or not?
    The processing fee in case of SBI is like 70000 extra as compared to LIC. SBI is forcing me to buy a house insurance of 45000, which LIC is not. they are also asking to do an agreement for the loan which will cost me 20000 which LIC is saying that they will do only Franking and Notrary which will cost only 2000. The rate which LIC is offering is 10.4% which SBI is offering me 11.25 % floating.
    Both are “Sarkari” types so that advantage is anyhow not there .. SBI is asking for a amount of 5000 for title check LIC has given the land to the builder so they are the official loan partner for the builder (Very high rated builder as good as K.Raheja, Hiranandani) so no price for title check. one more advantage LIC has fixed rate option as well (Which i think will go down so will not opt for it.)
    Can you please help me out by telling if i am missing anything.
    One thing i am worried about it is : how frequently LIC increases the rates or reduces the rates. Do they cheat in any way ? As you know my requirement is big I would like to choose a correct Bank. Your guidance is highly appreciated ?


    1. Prateek

      LIC is one of the preferred home loan providers .. however my suggestion is that do not get too much attached with the small charges here and there and do not judge too much on those . Overall this is one time thing and what you need to see is how good the bank is when you go for prepayment and interest rates changes . In that respect i think we already have people saying that SBI is best in that .. but even LIC should be good enough .

      1. Nikhil says:

        Pl don’t go with LIC. LIC floating rate is 10.4% but its valid for only three months and thereafter it would be 11.9%. LIC agents/area manager always say that interest is 10.4% and it would be linked to PLR after three months and remains silent afterthat. I applied the loan and thought that PLR rate is 14.4% and they will offer me 4% discount . When I received the sanction letter, that too after 15 days of applicaiton, i got a shock to see that, discount is 2.50% on PLR and 10.4% is offer rate only for three months only.

        If I go with fixed rate for 3 years and 5 years, i can’t switch to other bank as prepayment penalty would be there for dual rate of loans.

        Even i am not sure, if my floating rate in which interest of 10.4% is fixed for only three months is also considered as fixed by virtue of recent NHB circular. if yes, than its a game which LIC HF plays with the customers simply to cheat and hide things.

        1. Thanks for updating this info and sharing your experience !

  234. RAM RATTAN says:

    Dear Manish,
    I have taken 21Lac loan from LICHFL at interest rate 10.7% (fixed for 3 Year). In point number three i.e. LIC Housing Finance, it is mentioned that “LIC reduces the interest rates for home loan for its customers having any insurance/investment policy with LIC by at least 0.25% “. Somebody was also said about this rule to me. But when I have approaches to my LICHFL agent to do so he was refused and said no rule of this kind is present. I cannot get any circular in this regards by google search. Can you provide me circular in this regard so that I can approach to my LIC office again. One important thing is that I have LIC policy of 5 Lac only. Can I take 10Lac policy extra now or the policy should have date prior to loan date? Also this rule is applicable on fixed interest rate or not?

    1. I think it can only be done at the time of taking the loan , not later , I do not have the circular like that but in general this is true in many branches . Now you cant avail this feature .

  235. VK says:

    Any idea on the loan processing time taken by SBI…minimum to max range?


    1. No idea on that , you can ask this on forum : http://jagoinvestor.dev.diginnovators.site/forum , there are many SBI loan takers there who can help you on that

  236. gaurav says:


    I have one question let say if I have taken a HL of around 38 L for a tenure of 10 yrs. For which my EMI coming around 52k. Let say I have paid 52k*12 plus 3L in first year. So from second year onward what would be my EMi is if still 52K or less than that?

    1. It will still be EMI , because the tenure will come down , the banks in India mostly work on SAME EMI , BUT REDUCED TENURE model !

  237. JIGNESH SWADIA says:

    Manishji, I am very much grateful to you and your blog as it provides very very useful information on almost unknown issues. I am in a financial sector (Life/Non-life Insurance advisory + Mutual fund advisor). My experience with HDFC is also mixed. The initial procedure was fast and good. The disbursement was also done as per schedule, but, they do not run their interest rates schedule with RBI changes. If RBI Hikes interest rate, they make it effective from the next month, but, in the reverse case, they try to delay effect of decreased interest rate more than a quarter. For instance, the recent rate cut is still not effected by HDFC. Also, their system is an average. Before approaching HDFC, I approached SBI and their one line reply was quite surprising. “WE don’t have any home loan scheme for private sector employees or life insurance agents. We can not treat your LIC commission income as regular even if you are filing regular ITRs.” At that time, I was in a private sector company and also running LIC agency. Other people also explained that the procedure of SBI is too long and it is almost impossible for one to fulfil their all requirements if the applicant is from other than Government Sector.

    1. I agree that there can be mixed experiences from all the banks, All banks gives more preference to salaried class , its really tough to get a loan if you dont have a regular income flow

  238. Sid says:

    Hi All,

    Firstly thanks to each one of your views! Secondlt I need help with regard to taking a home loan. I am in a similar situation like Antony applying for a 40L loan. However I am faced with 3 scenarios for which I require you guidance:
    1. My wife and her father want to be co-owners and co-applicants for 40L loan. He is 56 yrs and high net income citizen with 6 years left to retirement from a pvt company. My wife is 28 yrs and is eligible for 28L as per her income level. We got a quote from housing finance for 10-12 years tenure, @10.75% floating emi roughly 60000.
    2.Only wife as the aapplicant – 20 years tenure, @10.75 floating, emi 40690.

    3. I jump in place of my father in law as the co applicant , my wife and I both put together are eligible fro 50L but require only 40L. @10.75% floating , 40690 emi.

    Which is tnhe best option. We want option 1 or would like to work on option 1 as our preference. Reason being, I want to stay clear from the loan as I would like to invest in property maybe a in a couple of years. If i go for option 3, I cannot apply for another property. Also,plz give alternate suggestions for the same apart from 3 which we are not aware of along with which HF to approach.

    Plz guide us in this hour of dillema. Its a little urgent, so all the inputs you provide are highly appreciated.

    Thanks in advance for helping out and congratulations on doing a fabulous job.

    1. Sid

      In my opinion if you want to go for another property on your own in some years , better let your wife and her father in law for as co-applicants in this loan . I think you should open up a thread on our forum : http://jagoinvestor.dev.diginnovators.site/forum and discuss this at length

  239. Srikumar says:

    Hi Manish,

    Looking at the EMIs and Home Loan options I am scared! 🙁 Now I am thinking of investing in DDA/HUDA Flats. How does that work and how fare the procedure is? There was a lot I heard about scams, etc. and I hardly believe any Govt. run schemes due to so frequent frauds. But I know few people surely benefit. Can you guide me on this please? I will be indeed thankful!

    Thanks in Advance!


  240. VK says:


    I have applied for Home loan at SBI 3 days back after completing all the formalities. Its a DDA direct allotment in 2010 scheme. Any idea how long they are going to take to respond if my docs are ok?

    1. Its a very specific question to a scheme , better ask it on http://jagoinvestor.dev.diginnovators.site/forum

  241. Floating rates are actually linked with a benchmark and as it moves , the floating rates also move. if the rates come down in next few months , then you can see reduction in the interest rate .


  242. Antony says:

    Hi , I am planning to take a home loan from lic for 40 lac. They are giving me @10.7 fixed for 3 yrs and later it would be transferred to floating.
    The second option is floating @ 10.4%, however the agents were saying that its linked to the prime lending rate and hence the rate would increase to around 11% after 3 months. Not sure what that really means, espescially considerign the rates are going down.
    Could you please advice how the floating rate is calculated and which would be best option

  243. Praveen K says:

    Hi Manish,

    thats a good article and good survey data.

    I took a loan just one month back from SBI. At that time of decision which one to go for, I was oscillating between LIC and SBI, just because LIC’s interest rate was a bit lower than SBI and with fixed cum floating plan.

    But finally I went with SBI, and I’m happy of that decision now. My reasons for choosing SBI are,

    1) Peace of mind with property documents — with the increasing no. of frauds, this is very important before investing in something big. LIC doesn’t care about anything of these documents, they only ensure that the person taking loan has the capacity to repay. But with SBI, they look for every details of the property document, encumbrance details, history of the property ( who owned it before), are their any legal heir to the property, due deligence from the builder, tripartite agreement etc ……. once SBI approves the loan, you can be sure that the property is 99% genuine.
    Also with SBI, the property should be registered for the same amount as in the sale agreement even if its higher than the government guided value ( which is the case mostly ), does avoiding black money generation etc….. But with LIC, you can register your property for a lower value than your sale value.

    2) Loan interest rate was less.

    3) The facility of maintaining loan account as overdraft account linked to your savings account. This works like a fixed deposit with 100% liquidity. When you park your extra money here, there is a considerable saving in the interest paid and also your loan tenure reduces much faster.

    4) Daily reducing balance – transfer your salary to your loan account and spend from there, every paisa staying there everyday earns you good interest at the rate of loan interest.

    5) The loan procedure is much structured now a days with the RACPC centrally controlling all the loan approvals.

    once or twice you got to visit this RACPC or your loan applying branch to get things done. which is quite OK, for all the benefit you get later.

    by far SBI seems to be the best for home loan…………feel free to deny this and give your reasoning……
    Praveen K

    1. manu says:

      Hi Praveen,

      I have been to sbi and they are asking to pay” SBI life coverage available with one time premium & premium is also funded by Bank. No Prepayment/Pre-closure penalty charged” …is this mandatory as they are saying this is mandatory. And there is a legal +valuation fee which includes 3000 + 0.25% of the propery value as well. So is it still worth of taking a loan from sbi payin all these …including mandatory sbi life coverage. I have enquired with hdfc and they just have 11236 processing fee which includes everything and no legal fee no mandatory insurance etc….they are giving 10.75% fixed for 3 years and later floating. I appreciate your help should i still go for SBI. Please help me. …or should i consider LIC in reg to the govt sector…. I have 10.7 % for 3 years fixed + processing fee of 12k for it no mandatory. Please advise which is best for me….should i still go for SBI.

      1. Praveen K says:

        Hi Manu,
        If you have a guarantor in your application, then SBI Life coverage is not mandatory. Please enquire on this again, go to RACPC and talk to chief manager straight away. But, I personally think SBI life coverage on your loan is important, its just like a term plan, which will take care of the liability when you are not there. Also one more thing, if you take SBI Life DO NOT opt for one time premium. Because, you may pay up the loan faster, so its a waste to pay all the premium at the start. instead, opt for ‘premium paid by me’, in this you will pay premiums every year and that too for the amount of principle left over only. yes, 3000+0.25% processing fee is there, that 0.25% i think will have max. cap value. When I took loan, I found that processing fee from Bank to bank will vary slightly, but not more than say rs 5000. It not wise to compare loans with processing fee, always think of loan in long term…….. HDFC’s floating rate is always higher that SBI’s floating rate. The benefit of SBI’s joining the loan with your savings account and daily reducing balance is enough to beat other banks benefits, cause I think in long term, this scheme makes your interest part paid become low and your principle gets paid much earlier.

        1. manu says:

          Dear praveen,

          Thanks a lot for the reply. You mean opt for the premium paid by month. Ok i will go for it. But any idea how much will be the sbi life premium per month for my loan amount of 20 lakhs for 20 years. I got the picture for loan emi but not for sbi life emi. Also you mean sbi loan will go under daily reducing balance where as other banks are mothly reducing balance is it rite ? Will there be huge diff for 20 lakhs on this ? And do they have online payments and statements generation and clearance as well. These are my last doubts, hope you dont mind 🙂

          Thank You

          1. manu says:

            Praveen, my take home is 80k and I dont have any other loans. My age is 32 and I am going for 20 lakhs loan. Should I go for 15 years or 20 years tenure. Also, I did not get the picture on 0.25% of cap value, means 0.25% of loan amount or property amount. Please suggest your inputs. Thank you buddy.

            1. Praveen K says:

              Hi manu,

              — SBI life premium paid by you is not for every month, it is for every year, like term policy. ask them about your premium for 20 Lakhs, I think it should be around Rs 8000-8500 / year.
              — Yes, daily reducing balance will definitely make a difference, if you transfer all your salary into your loan account and start spending from there. You can do a approximate calculation yourself, to see how much you save in interest part for every month, applying your usually spending pattern per month.
              — Yes, everything you can do online, no hassles.
              — less than 25Lakhs the processing fee is 0.25% and above 25-75L it will be Rs10000 caped. So for you processing fee is = 20L * 0.0025 = 5000 plus 1500 for legal fee and 1500 for technical fee. so total Rs 8000, guess that is much lower than other bank you said before.
              — Frankly speaking given your take home of 80K , your loan 20L is very less. If you don’t have other monthly comittments, then its better you go for lesser tenure. Just calculate with any online loan calculator and see how much more interest you pay for 15yrs and 20yrs. if you are comfortable with more EMI, don’t waste paying more interest.
              — for your info, I’m also 32 yrs and got a loan for 29Lakhs and my take home is almost same as yours. So we both are on the same boat. I went for a 15yrs tenure and my sbi premium is 9800/ year

            2. manu says:

              Praveen, thanks a lot for the reply. But I hve enquired in the bank they said I can pay monthly premium as well for which you are referring as per year 9800. Its better if you choose to pay per month right bec you wont have much burden and also you can pay something like 500 something. Ya but instead of going for 15 years, cant i choose 20 years and pay less premium and can use that money for anything else like some other investment. Anyway we will be clearing the loan before 20 years rite…I mean when you have some cash in hand or some onsite 😉 ….what do you say ? or am i wasting interest by choosing 20 years. can u suggest.

            3. Praveen K says:

              hey manu,

              if you increase your tenure, your sbi life premium will be more isn’t it? if you have the power to pay, then don’t waste on extra premium as well as extra interest.

            4. manu says:

              gt it….wll go for 15 years then. super. so in the same way…sbi car loan is also best as home loan is it. i mean in car loan which is the best option any idea ?

    2. ningthemm says:

      Hi Praveen ,

      What actually do you mean by “amount as in the sale agreement”? in your comment –highlighted below …
      ——— — —
      Also with SBI, the property should be registered for the same amount as in the sale agreement even if its higher than the government guided value ( which is the case mostly ), does avoiding black money generation etc….. But with LIC, you can register your property for a lower value than your sale value.
      I am not clear on this . Say I have to pay say 50 lac , excluding registration to buy a flat. Which of the following do you mean ?
      1. For SBI, Registration amount will on the 50 Lacs (ex : 6.7 % 50 Lacs) ?
      , For LIC or others, registration on a amount lesser that 50 lac is possible (ex: 6.7 % 29 Lacs)?


      2. The entire 50 Lacs is/can be written in two agreement i. Slaes agreement , ex 28 Lacs and ii. Construction agreement , ex 22 Lacs
      If this is the case,
      in SBI, registration should be done on sales agreement value (28 lacs here ) , so 6.7% of 28 Lacs , In case of LIC, registration can be done in much lesser that sales agreement value. Say something like 6.7% of 20 Lacs ?

      Can you/ Manish please explain. Waiting for you urgent reply.


      1. navin says:

        hi, could anyone reply on above query

  244. Ravi says:

    I think it will be nice if banks will introduce EMI payment for every 15 days(2times a month). This should bring down the overall tenure by approximately 2/3 years and also the interest payment we pay will be a lot lesser.

    1. Ravi

      I dont think it will suit most of the people , people like to work on monthly basis . Also can you share how did you conclude that paying 2 times in a month on 15 days basis will reduce the tenure to 2/3rd ?

      1. Ravi says:

        Hi Manish, It is just paying the same EMI in 2 parts. It will save the interest for that 14 days. In the long run it will bring down the tenure by 2-3 years.

  245. S S says:

    It is true that private banks are faster in their service but their after-sanction recod is very bad. I’ll prefer SBI, besides as mentioned by you employee fraud is a big issue with private banks. employess hide facts or bend rules just to reach their sales target, they are not at all bothered about customer because home loan is for 10-20 yrs and rarely a sales person stays with one bank for such a long time. he’ll leave the bank leaving applicant in trouble!

    1. Yea thats a good observation about the private banks

  246. Srinivas says:

    Interesting information.

    There are pros and cons for loans from all banks.

    Generally private sector banks process faster, and give more loan on the same property compared to theiee public sector counerparts. On the other hand, public sector banks have better after sales service(as per perception and comments form the blog).

    If seen objectively, the banks are all similar and one needs to understand the process so as to take full advantage of the system.

    Loan is taken for the purpose of a home and is a liability. The faster the loan is closed the better. All other things, though considerable, are secondary in nature.

    Would like to cite a personal example. Took a loan of 15 L from ING Vysya in 2008 for purchasing a house. There is no particular preference for the bank. This was patronised by the seller and they offered to clear my loan in a week(and did).

    From the time of taking loan my objective is clear. Close off the loa at the earliest. There are many rate hikes, few dips and prepayment penalty etc. However, my goal remained.

    After about 4.5 years, i will be paying last instalment next month and close the loan. For a 15 lakh loan, i paid 5.3 lakhs extra as interest and other charges. With slight differences in rates, this may change a bit. However, if the full tenure is run, one would normally pay about twice the amount as interest and other charges(depnds on tenure).

    As a bottom line, one should understand that he/she is at the mercy of banks as far as rate hikes, policies like prepayment penalties, processing period etc. However, one ca exercise control if he/she has control on repayment.

    1. Very good comment … focus on prepayment !

      1. S S says:

        Very good comment Sir, thanks for sharing.

        1. navin says:

          sorry to disagree. we must understand nuances of home loan, in addition to prime motive to have loan free happy life

  247. MAYUR says:

    I will recommend to try Corporation Bank. I have the best experience with them in all respects & for all banking matters.

    1. Yea Corporation bank is one good option, but given they have limited reach (unlike other big banks) . you will not hear about them a lot !

  248. Sowmini says:

    Hi manish

    I hav loans with Indian bank….intact I had one withnhsbc,but as you had rightly written the private banks show their real face only after u get the home loan…anything and everything theynwill want to contact their head office at Mumbai and for everything it is a written request…you shud be definitely good at letter writing….but with Indian bank..it is very smooth and personally they know us and help us in whatever information we need

    1. Thanks for your review !

    2. immanuel says:

      Hi,,i am about to get home loan in indian bank..please let mmee know the interest rate and pre closure charges…and also pros and cons with indian bank

      1. This you should ask on our forum or better contact Indian bank directly !

  249. Praveen says:

    May be this is bit out of topic – regarding educational loan. I am having home loan from Corporation Bank. Recently I approached the corporation bank for educational loan for my wife for higher studies. The approached branch was different than the branch from where my home loan got sanctioned.

    The Branch manager asked me if I am having any account with Corporation Bank. I said “yes, I am having savings account and home loan account in another branch”. The manager replied me, that I need to visit the same branch from where I am holding the savings account, and he can’t do anything in this regard. Point Blank. This despite me having very good track record in Cibil report.

    For him, having account in the same bank is not that important. For him what matters is whether the account is in same branch or not. He could have atleast told me to open a fresh account in his branch. But No. This is the attitude of public sector banks.

    I don’t think if any pvt bank, will chase away their prospective customers in this manner.
    Further, I visited Karnataka bank which sanctioned the loan within 3 days.

    1. Praveen

      Thanks for sharing your experience with corporation bank , I would say it will be different from bank to bank and branch to branch !

    2. Ravi says:

      You can transfer account from one branch to another instead of opening a new account. Not sure if Corporation bank offers it

  250. Abhinav Rateria says:

    I guess the sample size of 1500 is minuscule when we are analyzing the efficacy of a company in any process. SBI itself advertises of granting home loan to 20 Lakh customers. Even if we consider only Home Loans sanctioned after 2004 by all banks the figure may easily cross 40 Lakhs. A mere 1500 responses cannot be be considered a true picture of the market.

    1. Abhinav

      I think as the sample is properly distributed, this should give a very correct picture . Only when a biased group is surveyed, you can then say the results are not appropriate . What do you say ?

      1. Abhinav Rateria says:

        Dear Manish,

        I thought that it was a random survey, coz when i took it, my personal info like occupation was not asked. When u dont know the profile of the respondent(and actually u shudnt in a statistical survey), how can you comment on the distribution of the sample. And if u do know the characteristics of the sample and then selectively eliminate some then u are actually biasing your result, which I am sure you have not done. So a sample size of 1500 is way too small to conclude a market trend when the market is actually as big as 50 lacs. Though some of the points raised in the article are quite pertinent, I get a gut feeling that the statistical result was a mere exercise to corroborate your findings on the experiences of different customers at different banks whereas, the case should have been the reverse.
        P.S. I am myself working at SBI agree with most of the points in the article and more than happy with the free publicity for my bank…!!!

  251. Aquinas Prem says:

    One of the reasons why private banks taking up the top-5 slots in your survey is the usage of centralized processing systems. All loans processing and sanctioning happens at a central retail asset center where staffs are exclusively delegated for triggering verifications, analyzing documents etc ,the branches just courier the documents to them, even a few public sector banks like SBI are starting move into this concept.
    But on the flipside, in a PSB a customer can directly contact a branch manager regarding the status of his loan process on the other hand in a private bank the only face known to you would be an off role agent. And also if your loan papers aren’t 100% perfect, getting a minor deviation approved would be a herculean task.

    1. Hmm.. thats a very good point you have raised . May be public sector banks are not that friendly at start, but their processes are well thought of !

  252. Suhas says:

    I had 2 loan from LICHF.
    1 st loan was construction of house on ancestral land and we did not have any deed document except the property card on my fathers name still could get the loan with mortgage documents through LICHF.
    I prepaid the loan with no prepayment charges (if you show the payment is done through your earnings,no charges as per govt law now)

    2nd loan I got @ fixed interest rate of 8.9 for 3 yrs and i m in 2nd year now.

    Overall satisfy with LICHF but there initial processing is bit slow compared to pvt banks.

    Regarding SBI my friend wanted to take a joint loan in name of him,his wife,brother & parents so SBI was the only bank which gave it to them.

    1. Thanks for confirming and giving some positive instance from real life. Indeed public banks are the way to go for any kind of big loans in life , even though the initial process is slow and tiring , its still worth the effort

    2. Praveen says:

      Even I got home loan jointly in the name of myself, my brother, and my parents – from Corporation Bank.

      1. But you said that you got it from Karnataka bank ?

        1. Praveen says:

          Home loan – Corporation Bank
          Educational loan- Karnataka bank
          This I have stated clearly in my other comment to which u r referring.

  253. Arudra Kumar says:


    I had a very bad experience with SBI. I have a home loan from ICICI bank and due to the high interest rates, wanted to get it transferred to SBI. I submitted all the documents they have asked for including approval docs, link docs, my form-16s for 3 yrs, payslips along with 3 cheques. The process got so much delayed that they again asked for the latest payslip and I submitted. Everytime they used to say that my payslip is not latest and I used to submit the latest one religiously. This happened multiple time. In the mean time one of the cheque (Rs.1500) also got cleared. Other two cheques never got presented. I even met the AGM-Home loans-RACPC (Hyd) mutilple times but no luck. Every time I got only one reply, “We’ll get this done at the earliest”. I stopped contacting them and they never got back to me. Later, I approached the ICICI bank, paid some processing fee and got the interest rate reduced.


    1. Agreed thanks SBI or any kind of public sector banks really take too much time and frustrate the prospect customers , but thats the negative side of those, we cant deny them !

  254. srinivas says:

    SBH housing loan and SBI load are different? aming LIC and SBH which is best to prefer?

    1. I didnt hear anything like SBI housing loan

  255. Prabu Raja says:

    I’ve taken my home loan from LIC. The main attraction was the 9.5% fixed interest for 5 years. I felt the fixed for 5 years is a boon for salaried people. No – one including SBI gave fixed interest charges for so long.

      1. Prabu Raja says:

        Yeah Manish, I read that. That happened way back in 2005. I got my loan just last year, and I feel lucky to get 9.5 fixed at this particular time. Within a month’s time after my loan disbursal, LIC themselves raised it 0.5% and you know what’s the rate today!

  256. Subhankar Das says:

    I have a home loan from Bank of India at 11% interest from last year November. But till no rate cut has been declared from bank so far, which is very discouraging. Being a public sector bank how their approach is so relaxing during competitive market. Bank officials informed me that if rate has been decrease any time customer will not get any information but if rate is increased customer will be informed accordingly. Is it a proper approach at all? So as a customer I would say “No” to Bank of India. IDBI is far more better in terms of Service and rate. These should be the parameter one should consider before taking loan. thanks for Jagoinvestor for bring this topic online.

    1. Hmm .. I didnt expect this from public sector bank , I thought online private banks are unpofessional in interest rate increase/decrease .


      1. Subhankar Das says:

        I come to know from a leading New Paper on 8/05/12 that Bank of India slash home loan interest upto 30 lakhs to 10.5%, when I asked my branch manager on 15/05/12 about this, they are not aware of any such changes. Before taking loan there were lot things you will listen from officials from banks and related hubs. But they are not true of course every time.

        1. Can you show them that notification and talk to branch manager directly ? Threaten them to complain to Banking Ombudsman if you dont get satisfactory answer from them


          1. Subhankar Das says:

            I also have a same thought. Probably I am going to speak to him directly very soon with this news publication. And raise this issue to their grievance cell directly before going to banking Ombudsman. Thanks Manish for your suggestions and reply.

  257. CL RAO says:


    Without any doubt SBI is the Most preferred Bank for Home Loan but While exploring about SBI Max Gain Home loan , I have been informed that SBI also asks for guarantor ! even if the Loan eligibility criteria is completely met ?

    Q1 Is Guarantor mandatory in SBI Home Loans ?
    Q2 Is there any way to get Home Loan without Guarantor ?

    I have been searching around a lot & found this article: http://www.rediff.com/getahead/slide-show/slide-show-1-money-how-I-got-my-home-loan-without-a-guarantor/20110728.htm

    Q3 Is it possible to avoid a guarantor by taking insurance specially from SBI (let’s say buying Smart shield) ??

    Please Note : I would be taking a Construction Linked Plan & date of Possession is 30 Months away.

    Aside, Manish a small request : could you pls put up a step by step process for Loan process including all documents required , Important things to note etc. Basically a Guide or Commpendum which will help people who are going for Home Loan for first Time.

    CL RAO

    1. I am actually not aware about this guarantor thing at all in SBI , I think you should better start a thread on our forum and there are many guys there to solve your queries : http://jagoinvestor.dev.diginnovators.site/forum

      1. Praveen K says:

        Hi Rao,

        If you take the insurance from SBI (RinNraksha) for your home loan, then gurantor is not required. I got my home loan approved only last month, without gurantor.

        1. Thanks for confirming that !

        2. CL RAO says:

          Hi Praveen,
          Thanks for the Info , so that measn you were also asked to furnish a Guarantor ?

          1. CL RAO says:

            Hi Praveen,

            As suggested by Manish , have started a Thread in the forum section on the SBI realted issues – http://jagoinvestor.dev.diginnovators.site/forum/sbi-home-loan-myth-vs-realities/3629/

            If possible could you Pls share your experience of taking SBI Home Loan & specially of avoiding Guarantor by taking insurance … it would be of great Help.

            CL RAO

            1. I am sure you will get some answers from it

      2. CL RAO says:

        Sure … I will start a thread in forum 🙂

      3. manu says:

        I am trying to take a home loan for 20 lakhs and i have seen that sbi is charging “SBI life coverage available with one time premium & premium is also funded by Bank. No Prepayment/Pre-closure penalty charged” . I am not sure what is this and how is it charged. can anyone tell me more about this…. and they are syaing that this is mandatory. and also they have a (legal fee + valuation fee) of 3000 for my loan + 0.25 % of total property value (40 lakhs) . Shoud i go for hdfc instead as they dont have this mandatory insurance policy and no legal fee etc. I have 10.75 fixed for 3 years + 11,236 processing fee from hdfc where as 10.50% from sbi floating. Please advise or should i go for LIC 10.7 fixed for 3 years and no insurance mandatory and no other charges. I am really confused pls help me. As per reviews ebody is telling sbi in this site and im confused…is it because of daily reducing option we should go for sbi ? My age 33 , take home 80k, no other loans. Please suggest me tenure and which bank loan should i go for ? Lic or HDFC or SBI. why and what is the sbi life coverage , I dont uderstand.

        1. Manu

          There is no mandatory policy like this , This is compulsion put by the officials only . Tell them that you will file an RTI application for this to SBI and investigate the matter . They will just change their colors ! . Tell them you are not interested , they will come back to you in some days !

        2. parthiban says:


          I am also in same boat…which one to choose, HDFC / SBI / LIC HFL

          Most of the replies support SBI but I heard HDFC better due to
          1. good pre-payment options
          2. reducing interest rates for existing customers

          please confirm?

          1. There cant be one answer on this , it differs from bank to bank , person to person , branch to branch also !

  258. Tejaswi says:

    I had taken loan from HDFC (not bank). It took 4 months to disburse the loan!!

    When RBI hikes interest they are the first to increase. When they introduced Base Rate, I asked them if I can opt for it..They told we are not BANK and hence RBI guidelines are not applicable to them. When the interest rates are down, they do NOT bring it down for existing customers. But if you see the results they are always in FULL profit QOQ, YOY…. that makes frustrating

    I took the loan in 2008, and in the past 4 years, only 65K of principal was deducted. Despite knowing that it is good time to invest in Equites, I just prepayed 60% of outstanding loan this month and target to foreclose it completely before this year (i.e. within 5 years from date of loan taken)

    I vow not to take loan from these private banks again…

    1. Thanks for sharing your experience ..

  259. RD says:

    I am planning to take home loan from DHFL. I had visisted their branch. Everthing seems good n transperent till now. Their interest rate is around 11% and no pre payment charges. Anything that i need to take care before taking home loan from DHFL.

    1. I would say just make sure you are sure of the terms and conditions and overall rules .

      1. AMRITA MASHAR says:

        Dear Manish,
        I am from Ahmedabad Gujarat. I want to take home loan for 16 lakhs. yesterday I visited one home loan Mela. I found that private finance companies are providing loan at cheaper rate. DHFL home loan interest rate was 9.60%, kalupur Bank with 10% and cosmos co-operative bank with 9.75%. Just now, I was searching for co-operative banks home loan rates which are more lesser than Nationalize bank. I want to know that which banks and financial institute are more reliable and also in case of transparency.

        1. Just the starting number is not important. Home loan rates are often lesser in start, but its not FIXED for all the years. It floats up and down later and it can rise later. So dont get too much attached to lower number . It hardly makes a lot of difference .

          You can also check with HDFC , SBI etc ..


    2. shailendra says:

      No no no no no no no no no no no ……………..
      Don’t think to go with DHFL . Within a year they will increase your interest rate not once but thrice.
      they will be very nice while giving loan but the day your loan get sanctioned you are in hell.

  260. Rajesh says:

    Even after RBI has instructed all banks to follow same rate of interest for old and new customers, banks still continue to offer lower rates to new customers while continuing with higher rates for old customer. How does one get this corrected. Some exceptions like SBI who have brought scheme for old customers to migrate to new lower rate of interest by paying a one time charge of 1% on the principal outstanding.


      Rajesh, Lot of Banks are now offering lower interest rates to old customers by paying 1-2% of outstanding loan amount.

    2. I would say this is just unfair .. you need to complain to RBI on this .

    3. Pravin says:


      Its true. I have taken home loan from Bank of Baroda and they dont give option to switch to lower rate by paying the penalty.


  261. Souvik says:

    Thanks Manish..it was really helpful. I was on a dillema between chosing LIC or SBI with their parallel interest rate of 10.4% and 10.5% and similar features. But your blog made it easy for me to take decision. I would like to go with SBI considering it to be PSU, more Reliable, Less processing fee, Daily reducing calculation, and being directly ruled by RBI decisions. Though on today’s date LIC plan of 10.7% with 3 year fixed looks attractive but I am just optimistic that Home Loan interest will be on a down flow in 2012-13.

    I just have a last question. RBI has announced on 17-Apr-2012 to reduce Home loan interest. Has that been already applied in banks or they are yet to do so.

    1. Souvik

      Yea go with SBI , I think that would be the best choice .

      Banks have lowered the interest rates recently .

  262. Priya says:

    I agree that SBI is the best bank for Home Loan! Though the initial phases will be tough with SBI (with all the processes , documents etc) ,once loan is sanctioned ,we need not worry at all! Moreover , I believe that if SBI sanctions a home loan the property is also genuine and there are very less chances of any fraud in that property.Also , the maxgain scheme of SBI home loan is really good as this scheme allows us to map an SBI account to the loan account . The calculation of interest will be done on the basis of your outstanding loan amount and also the balance which you are maintaining in the linked SBi account. So if we maintain a good balance in the linked account , we end up paying a lesser interest. Hope this info helps.

    1. Thanks for acknowledging the fact and also sharing your personal case with us .


  263. Durga Prasad says:

    Nice article!!
    I came to know that SBI does not offer loan for buying home in panchayats like in the outskirts of Hyderabad in my case. Hence I go by LIC HFL.

    1. Yes . some companies might have that kind of restrictions .. Hence in those cases you have to go with companies which would loan you specific to your requirement .

  264. harika says:


    We have our home loan with HDFC.we had a gud experience till date with HDFC..my only concern is other day i was reading an article regarding base rate which is considered to be more transparent.HDFC doesn’t operate on base rate & it operates on PLR.i could not understand how does that make any difference with floating rate home loan..can someone explain pls..


  265. Sushil says:

    you have written a very true fact that Private Banks are good before taking Home Loan and Govt Banks are good after taking Loan….i applied for Home loan in 2009 . I applied online to HDFC, PNB, SBI and Union Bank…..HDFC rejected at once saying that we do not give home loan in small cities. PNB told so many formalities that could not be completed even in a year. Union bank never approached me untill i send mail to their CMD. I said that if i would have called private bank they would have roaming around me day and night and your bank have not even bothered to contact me….after that in 2 hours i got a call from bank but their formalities are quite rigid….SBI offered me loan with little Least docunmentation . It sanctioned my loan in an hour. YES IN AN HOUR…STRANGE FOR ME…BUT IT IS REALLY TRUE….The Intrest rate was 8% first year and 9 % second and third year….When govt announced subsidy on home loan…i immediatly got in my loan account…..Everything is fine with SBI…

    1. Great to hear positive acknowledgement for this . Thanks for sharing your case !

  266. Amit says:

    HDFC (not the bank) didn’t even appear in the first eight (i.e. less than 1.6% customers)? Wow! I am a very happy HDFC customer and am definitely surprised to see the results.

    1. Amit

      May be a lot of HDFC customers might have voted for HDFC Bank per se .. you dont have any control on that

    2. Shaleen Mathur says:

      HDFC ltd has 48% govt holding while HDFC Bank is a private bank. Hence their interest rates & policies, treatment with customers differ.

  267. Vaibhav Joshi says:

    I have taken a loan from HDFC for ready possession flat. Not good experience while taking disbursement. My loan was approved and there were no issues with documents still they took around 10 days to prepare disbursement cheque.
    However about prepayments my experience is positive. I could easily make prepayment in HDFC( Magarpatta branch) and no they have not charged any prepayment charges ( according to loan statement and amortization statements).

    1. Good to hear your experience with HDFC 🙂

  268. Dhaval says:

    Totally agree with you. I am with SBI and have the great experience with them. Yes indeed they had asked hell lot of documents. One good thing in SBI is “Daily reducing” concept.

    1. Dhaval

      Thanks for acknowledging this

  269. Very nice comparison.

    However, everybody is not that lucky to get loan from SBI.
    One of friend is in Noida, and he was planning to take loan from SBI for his property from Jaypee Green, Noida. But SBI denied to give loan for that as most of the builders in NCR are giving property on a land which on Lease for 99 years. And SBI doesn’t entertain them.

    1. Obviously banks will have their own pre conditions .


    kudos for excellent post.

  271. m says:

    very informative article.i was of view that PSU banks are least preferred,but was shocked after reading your article.the truth is, it is vice-versa.i will now also prefer SBI.thanks for your timely article.also have an article on best credit card issuer.

    1. No .. PSU banks are very much preferred .

  272. Avisek says:

    Hi have recently taken home loan from IDBI bank kolkata. I must say the procedure was very smooth and fast. I didn’t visited the bank much rather their representative came to me and signed all the required document.The loan approved in 40 days . So i must say IDBI is a very good bank for their services. More over i took the loan @ 10.75% . But after the publication of the budget the rates down to 10.5% without any delay and i got the msg that my premium amount has been reduced.

    1. Good to hear that Avisek ! .. IDBI is one good option

      1. Bala says:

        Yeah.. I too agree with Aviseks’ comments. I had loan from IDBI, the process was very smooth & fast.. No deviation/confusion from day one.

        1. Thanks for sharing that !

  273. Satya says:

    You forgot another very important factor. SBI offers Daily Reducing Balance while all pvt banks offer monthly reducing balance. A simple excel calculation shows, given the same interest rates, daily reducing balance offers much higher benefit to the consumer.

    1. Thanks for pointing it Satya .. Never knew that htey are on daily reducing !

      1. Biswa Singh says:

        Hey Manish, How come you never heard of SBI max gain house loan? Anyways
        i follow all your articles and learnt a lot. I am also going with SBI max gain house loan for my flat. There is wealth management company which some tie up with my builder and they are helping to process the home loan without charging any money. Do you see anything fishy here? The guy from wealth management company told me that they get some % from the bank.

        1. Biswa

          I meant I dont know much about SBI Maxgain , I have heard it but . Those wealth management guys might be getting the commission from builders for making a SALE !

          1. Biswa Singh says:

            Thanks! Currently i am reading your book also. Perhaps I have done bit late but i am excited about my shift in attitude towards money and investing. Your blogs and book really helped me a lot.

            1. Good to hear that 🙂 .. Would love to see your review soon on flipkart !

    2. dr kishan says:

      Dear Satya
      Although I am no authority on excel calculations, what I think is that daily reducing and monthly reducing system leads to same amount of interest being charged because the payment made by the consumer (i.e. EMI) is just once a month. If the consumer pays emi on daily basis, then, at the end of the month the interest paid would be less in a daily reducing system than when it is paid according to a monthly reducing system.
      Please correct me If I am wrong
      dr kishan

      1. Mihir Naik says:

        @Dr Kishan : Yes, your point seems correct. If someone is paying daily then it will be beneficial. One more thing from my side.. If they are calculating on daily basis then this will work against you, as the interest will be cumulated daily and will be added back to your total payable amount!!

        Please reply.. Thanks

        1. sreeram says:


          SBI calculates interest on daily reducing balance but the interest added back to the loan outstanding (compounded) only on the last day of the month..

          So, daily reducing offers a distinct advantage when compared to other forms of calculation..

      2. Satya says:

        Dr Kishen – Daily Reducing balance is advantageous to the consumer. The interest is calculated on a daily basis. e.g. I pay EMI on the 10th of every month. Bank levies interest on the last day of the month. So, for the higher amount, I pay interest for 9 days (1st to 9th) and then for the lower amount (i.e. Amount balance on 1st MINUS EMI Amount), I am levied interest for the 21 days (assuming a 30 day month). If it was monthly reducing, then the bank would have assumed that I have paid interest on the last day of the month and levy interest for 30 days for the higher amount. I can say that it makes a difference of about 0.4% or so approximately. This is also applicable to all the prepayments that you make.

        Of course, if you were to pay the EMI on the last day of the month, then there is no benefit for you.

        You can search on the web and you will get many formulae.

        1. dr kishan says:

          Dear Satya,
          Thanks for replying. The system of daily reducing calculation is per se advantageous over the monthly reducing calculation. But to avail this benefit we have to make payments also on a daily basis. Only then will the total interest payable be less. “Daily Reducing” means: interest is calculated on daily closing balance. The daily closing balance is same for one month, (emi date to emi date, dont calculate 1st to 30th) because the EMI is paid only once a month, and is not paid daily. Since we dont pay emi on daily basis we dont get any advantage of the daily reducing system of calculation. Example:

          Let loan be 10 lacs and interest rate be 12%:
          Let Emi paying date be 15th of every month starting one month after loan disbursement. Loan disbursement date be Jan 15th 2010. EMI amount is 15000
          Monthly reducing system
          From jan 15th 2010 to feb 14th 2010 the interest is
          1000000x 12% x 1/12 = 10000
          Suppose On 15th feb you repay interest 10000 plus principal 5000
          Then from feb 15th 2010 to mar 14th 2010 the interest is:
          995000 x 12% x 1/12 = 9950
          Suppose On 15th mar you repay interest 9950 plus principal 5050
          Then from 15th Mar 2010 to Apr 14th 2010 the interest is:
          989950 x 12% x 1/12 = 9899.5
          Suppose On 15th apr you repay interest 9899.5 plus principal 5100.5
          This can be worked upon for as lonfg as you want.

          Daily reducing balance:
          For jan 16th balance is 1000000 and interest is:
          1000000 x 12% x 1/365 : 328.77
          you have not paid any amount since your emi date is 15th of next month
          for jan 17th balance is 1000000 and interest is:
          1000000 x 12% x 1/365 : 328.77
          you have not paid any amount since your emi date is 15th of next month
          for jan 18th balance is 1000000 and interest is:
          1000000 x 12% x 1/365 : 328.77
          and so on for one month = 31 days
          so till 14th feb 2010 the total interest is 31 x 328.77 = 10191.87
          On 15 the feb you pay 15000 and principal repayed will be 15000 – 10191.87 = 4808.13
          For the next month (28 days) the daily outstanding balance would be 1000000 – 4808.13 = 995191.87
          the daily interest would be
          995191.87 x 12% x 1/365 = 327.19
          the total interest from feb 15th 2010 to mar 14th 2010 would be
          28 x 327.19 = 9161.32
          On 15th mar 15000 is paid. the principal repayed would be 15000 – 9161.32 = 5838.68
          The balance would be 995191.87 – 5838.68 = 989353.19
          For the next whole month (31 days) the daily interest would be
          989353.19 x 12% x 1/365 = 325.27
          the total interest from mar 15th 2010 to apr 14th 2010 would be
          325.27 x 31 = 10083.37

          thus calculating three month total interets in both systems

          monthly reducing balance:29849.5

          daily reducing balance : 29436.56

          a difference of 412.94.
          as you go on calculating the difference would further decrease.

          That is why I feel the daily reducing balance is advantageous only if repayment is done on daily basis and there is practically no difference if we make the repayment on monthly basis.

          Please correct me if I am wrong
          dr kishan

          1. Satya says:

            An initial calculation shows that what you say is true … I am making a detailed excel sheet. I agree with you on one point though, that the EMI is derived by considering “monthly rests” … I guess it makes a difference if you were to overpay .. not sure … i ll do it on my excel and check it out … but its quite a shock to me, I should say!!!!

          2. Satya says:

            I did a detailed excel sheet. The data I took is as follows.

            Loan Amount: 20,51,000
            Interest: 7.75%
            Duration (months): 222
            EMI: 17,417.88

            When I put this on Daily Reducing balance and take EMI pay date as 10th of every month, the loan ends on Mar-2028 and the total interest paid is Rs 17,56,978.80.

            When I put this on Monthly Reducing Reducing balance and take EMI pay date as 10th of every month, the loan ends on Jul-2028 and the total interest paid is Rs 18,17,360.27

            The diff may not be huge, but if the amounts and interest rates are higher, the difference will go up.

            I am glad to share this excel, but there is no way of attaching that excel to this comment 🙂

            1. Praveen K says:

              hi satya and dr kishan,
              I think transferring your whole salary into your loan account at the start of the month and then start spending from there, will give you full benefit of this daily reducing balance. In fact every paisa you park in that loan account, be it for one day or 1 year, indirectly earns you an interest rate equal to your loan interest rate.

            2. Anil says:

              Please share the spread sheet to my email id: aniljaganath@gmail.com

            3. Rahul Bajaj says:

              Please share the exel sheet on my email i d as well

            4. Satyajit says:

              Hi Mr. Praveen,

              Could you please explain on this more. How we can transfer our whole salary into the loan account at the start of the month and then start spending from there? Whats the procedure & what exactly it works?

            5. sharan says:

              Could you please explain on this more. How we can transfer our whole salary into the loan account at the start of the month and then start spending from there? Whats the procedure & what exactly it works?

            6. fahad khan says:

              could you please share the excel with me @ frndz.fahad03@gmail.com

              thanks alot!!

            7. Lucky says:

              Hello Mr. Satya,

              Could you please share the excel sheet that you have created for comparing monthly and daily reducing balance modes of interest calculation. my id is luckyjhony@rediffmail.com

              Thanks in advance.

            8. Sunil Kharatmol says:

              Great work..It will help me a lot for my future home loan.

            9. Guru says:

              Hi Satya,

              Please share the excel sheet to my id : guruvaiya.m@tcs.com
              Thanks in advance…

            10. kapil says:

              Please do share with me the excel sheet at kapilshars.mn@gmail.com
              . Regards

            11. shirish says:

              @satya Can you please share the excel for my understanding…..email id is modi.shirish@gmail.com

            12. Tanmaya says:

              Hi Satya,

              Can you please share the excel at tgupta86.s@gmail.com

            13. Parthiban says:

              Can you please share the excel to pparthiban77@gmail.com

            14. Deepak Bansal says:


              Could you please share the excel at deepak.taurian@gmail.com

            15. Shashikant says:

              Pls share the excel @ qa.shashi@gmail.com.


            16. Satyajit says:

              Hi Satya,

              Can you please send the Excel Sheet @satyajit_dugal@yahoo.co.in.

              Thank you.

            17. Ash says:

              Hello Satya,

              Could you please share sheet to me at ashi0911@gmail.com


            18. ravinder says:

              plz send me that worksheet to my mail idthen it will be helpfull…………..

            19. raj says:

              Dear Satya,

              pls share your Excel sheet so that i will also plan for Home loan and its give knowledge.

            20. Raman Kamboj says:

              Please share Excel Sheet at raman.deep24@hotmail.com

            21. Pradeep L says:

              Can you please share the excel sheet to the e-mail id pradeepl.psg@gmail.com ?

            22. Anupama says:

              hi Satya

              I am planning to take some home loan. Reading the experiences and knowledge of all experienced takers to understand the whole process and how to minimize liability. Daily reducing & monthly reducing calculation really seems to be eye opener. Thanks for your info.
              Also pls advise what date is best to pay EMI for more benefit.


  274. Satya says:

    I totally agree with you … SBI is the best when it comes to home loan. I am a satisfied customer of SBI. Also, I got a loan at 7.75% fixed for 20 years in 2005 Ugadi – at that time, pvt mnc banks were offering fancy products at 6% interest floating with linked savings account and such. My colleagues and friends declared me insane for having gone to a public sector bank. I had the last laugh 🙂

    1. Haha

      Good one .. 7.75% fixed for 20 yrs is dream most of the people cant dare to see with closed eyes too 🙂

    2. Karan Batra says:

      Hats off to your vision Satya

      In 2005 when the country was booming, you had it in you to opt for a Fixed Rate term loan… Glad to hear that your decisions are now paying back…

    3. Suresh Kumar says:

      Hi Manish,

      Could you please comment which option is better one for housing loan principal repayment

      Paying lumpsum amount annually to reduce prinicipal amount
      Paying Lumpsum amount for a reduction in EMI.

      And also at present my LICHFL housing loan interest is 11.75% still i have principal amount fo 21.15 lacs to repay . is it benefitial to shift to SBI now.

      1. BEtter pay lumpsum for reducing the principle amount

        1. Chitra says:

          Hi Manish,
          Could you elaborate on your reason?
          Prepayment towards reducing principal amount or for reduction in EMI , which is better? Have you any calculations for being in favor of the former?
          And does the bank offer you this choice while making prepayment?
          We have a loan from SBI for 20L for 15years, currently in 3rd yr.
          We will certainly inquire with them but armed with your recommendations.

    4. Rolind D'souza says:

      I’d say it was smart of you to make the SBI Fixed rate move back in 2005. But, it was then when the rates were touching new lows. Will making a similar move in the current market scenario be equally smart? The rates are really pretty high and fixed rates are even higher…
      I was on this website call MoneyIvy and the dudes there helped me understand how the situation was back in early 2000s and now. LOL…maybe it’s my keen interest in finance but I was surely impressed with the insights the guy offered and his professionalism… :p . you should surely go and check em out as well… http://www.moneyivy.com/home-loan-interest-rate-comparison

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