Housing loans in India - An Overview

Housing loans in India have increased in the past few years. The number of people taking housing loans has increased by 15% in the past year. The average loan size has also increased by 10%.The average loan tenure is 20 years and the Interest rate currently is in the range of 8%. Check out the the interest rates provided by different financial institutions here -

 

The government of India has introduced several schemes to promote housing loans in the country. The Pradhan Mantri Awas Yojana (PMAY) is a flagship scheme that provides interest subsidy on housing loans. Under this scheme, eligible applicants can get an interest subsidy of up to 2.67 lakhs. The government has also introduced the Pradhan Mantri Awas Yojana – Gramin (PMAY-G) which is a scheme for rural housing. Under this scheme, eligible beneficiaries can get a subsidy of up to 1.2 lakhs.

There are several types of housing loans available in India. The most common types are home purchase loans, home construction loans, and home improvement loans.

Home purchase loans are used to finance the purchase of a new home. The loan amount can be up to 90% of the purchase price of the property. The interest rate on home purchase loans is usually lower than the interest rate on other types of loans.

Home construction loans are used to finance the construction of a new home. The loan amount can be up to 80% of the cost of construction. The interest rate on home construction loans is usually higher than the interest rate on home purchase loans.

Home improvement loans are used to finance the repair and renovation of an existing home. The loan amount can be up to 50% of the cost of the repairs and renovations. The interest rate on home improvement loans is usually higher than the interest rate on home purchase loans.

Home loan interest rates in India are currently at an all-time low, making it an ideal time for individuals to purchase a home. Numerous banks and financial institutions offer home loans at competitive interest rates, making it easier for individuals to find a loan that suits their needs.

The interest rate on a home loan is a key factor that determines the monthly instalments. Hence, it is important for individuals to compare the interest rates offered by different banks before applying for a loan.