Home Loans- Lucrative Bank Products
Home loans are the most promoted financial products that banks offer. They have the longest tenure periods in comparison to other types of lending. Longest tenure factors force borrowers to search and compare interest rates offered by multiple banks. Because interest rates on home loans are responsible for a person to decide which lender he has to borrow from. Interest paid on home loans depends on distinct factors including tenure period, the borrower is salaried or self-employed, etc.
Once your loan application is granted, you will repay them in monthly EMI cycles. EMI amount includes the principal amount and the interest due. In the EMI system principal is reduced monthly, and interest is calculated based on the outstanding balance.
Tax Benefits To Borrowers Of Home Loans
Under the Income Tax Act of 1961, borrowers of home loan are eligible for tax benefits for both the principal amount and interest. As per the act they are eligible to get an income tax credit for interest repayment up to ₹1,50,000 per year.
Also read:PPF Update, How To Get Most Benefit From PF Account?
Early Loan Closure
Few banks allow their borrowers to close their loan accounts early by paying off one or more bulk payments. But there are some who charge penalties on early closure of up to 2 per cent of the outstanding amount.
Ten Banks Offering Home Loan On Low Interest Rates
|Banks||RLLR||Min. Interest Rate (%)||Max. Interest Rate (%)|
|Bank of Maharashtra||6.8%||6.4%||7.8%|
|Bank of Baroda||6.5%||6.5%||7.85%|
|Punjab & Sind Bank||6.5%||6.5%||7.35%|
|Bank of India||6.85%||6.5%||8.2%|
|Punjab National Bank||6.5%||6.5%||7.65%|
|Kotak Mahindra Bank||6.55%||6.55%||7.05%|
|Union Bank of India||6.8%||6.6%||7.35%|
|IDFC First Bank||6.5%||6.6%||8.8%|