How to Apply for a Home Loan in Bangalore – Interest Rates and Eligibility Criteria
Getting a home loan in Bangalore wouldn’t be too difficult if you have the repaying capacity and a good credit score in place. Though RBI has recently raised the repo rate by 40 bps, which has affected the home loan interest rates, still the rates are lower than most financing options like personal loans. Also, getting a home loan comes with a plethora of benefits, including but not limited to tax benefits under Section 80C, 24(b), 80EE, and 80EEA. So, if you’re someone residing in Bangalore and looking for a home loan for that dream house of yours, this blog might just interest you. Here’s how to apply for a home loan in Bangalore.
Features and Benefits of Taking a Home Loan in Bangalore
Here are some of the features and benefits of home loans:
1. Home Loan for All your Housing Needs
Home loans can be put under a larger basket of loans that includes home improvement loans, home renovation loans, plot loans, etc. So, if you’re planning to buy or purchase a house, you can go for a home or housing loan. For renovation and repair work, you could go for a home renovation or improvement loan. Most of the time, the interest rates for these loans are similar to that of normal home loans.
2. Tax Benefits
One of the benefits of a home loan is that you can claim tax benefits under the Income Tax Act, 1961.You can claim up to Rs.1.5 lakh on principal repayments under section 80C of the Income Tax Act, up to Rs.2 lakh on interest repayments under section 24B, and more benefits under special circumstances u/s 80EE, 80EEA, and 80C.
3. Low Interest Rates
Home loan interest rates are usually lower than other financing options like personal loans. For instance, you can get a home loan of Rs.10 crore at interest rates starting from 8.74% p.a. with Navi. However, the final rate offered is solely at the discretion of the lender, who decides on the rates based on your repayment capacity, credits core, etc.
4. High Loan Amount and Long Tenure
Affording a house in today’s world is not cheap, especially if you live in the “Silicon Valley of India”. However, you could make the dream of owning a house come true by applying for a home loan. You can get up to 90% of property financing (LTV ratio or loan-to-value ratio) from lenders like Navi. Also, you could repay at your convenience, thanks to flexible tenures that could extend from 25 to 30 years.
5. Easy Balance Transfer Facility
If you wish to transfer your home loan from your bank to any other bank/NBFCs for several reasons, such as high interest rate, service charges, customer service experience, etc., you could opt for a home loan balance transfer.
Interest Rates for Home Loan in Bangalore
It is important to know which bank/NBFCs offer home loans at what interest rates. If you are building a house or planning to buy your dream home, here is a list of banks/NBFCs offering home loan with its respective interest rates and processing fees:
| Lending Institutions | Interest Rates Starting From (per annum) | Processing Fees |
| Navi Home Loans | 8.74% onwards | 1% |
| Kotak Mahindra Bank | 9.00 % onwards | 0.5% |
| Axis Bank | 8.95% onwards | 1% |
| Yes Bank | 8.95% onwards | 1.5% |
| ICICI Bank | 8.85% onwards | 0.5% – 2% |
| HDFC Bank | 8.90% onwards | 0.50% |
| Bank of Baroda | 8.60% onwards | 0.50% |
| Bank of India | 8.60% onwards | 0.25% |
| LIC Housing Finance | 8.65% onwards | Check with lender |
| Federal Bank | 9.90% onwards | 0.50% |
| Union Bank of India | 8.60% onwards | 0.50% |
| Reliance Home Finance | 9.75% onwards | 0.5% – 1% |
- Instant Sanction Letter
- Flexible Repayment
- Zero Processing Fee
- 100% Paperless Process
How to Apply for a Home Loan in Bangalore
Follow these steps to apply for a home loan in Bangalore:
- Step 1: Go to the lender’s website or app
- Step 2: Go to the home loan section
- Step 3: Click ‘Apply’ to proceed
- Step 4: Fill in details like your name, DOB, monthly income, PAN number, etc.
- Step 5: Check your loan eligibility
- Step 6: Choose loan amount and tenure
- Step 7: Get in-principle approval
Eligibility Criteria for a Home Loan in Bangalore
Every lender across India can set different criteria that you will have to meet before attaining a home loan. Still, there are some common criteria that you should pay attention to:
| Criteria | Limit |
| Age | Between 21 and 65 years old |
| Nationality | Indian resident or non-resident Indian |
| Income | Varies across cities but is generally set at a minimum annual income of Rs. 1,80,000 for salaried employees and Rs. 3,00,000 for self-employed borrowers |
| Work experience | Most lenders accept borrowers with a minimum work experience of 2 years |
| Credit score | Generally, 750 or above |
| Eligible for a joint loan | Only parents, spouse, siblings, or children |
Documents Required to Apply for Home Loan in Bangalore
This requirement can vary depending on the category you fall under – salaried or self-employed.
1. For Salaried
- PAN
- Identity Proof: Passport, voter’s ID, driving licence, Aadhaar Card, etc.
- Address Proof: Identity Proof: Passport, voter’s ID, driving licence, Aadhaar Card, Ration Card, Property Tax, etc.
- Income Proof: Salary slip for the past 3 months
- Form 16 for the past year
- Certified letter from Employer
- Increment or Promotion letter
- IT returns of past 3 years
2. For Self-employed
- PAN
- Identity Proof: Passport, voter’s ID, driving licence, Aadhaar Card, etc.
- Address Proof: Identity Proof: Passport, voter’s ID, driving licence, Aadhaar Card, Ration Card, Property Tax, etc.
- Income Tax Returns (ITR) of last 3 years
- Balance Sheet and Profit & Loss Account Statement of the Company/Firm (duly attested by a C.A.)
- Business License Details (or any other equivalent document)
- The license of Professional Practice (For Doctors, Consultants, etc.)
- Registration Certificate of Establishment (For Shops, Factories & Other Establishments)Proof of Business Address
On Navi’s technology-driven platform, you can easily and instantly obtain a home loan from the comfort of your home. All you have to do is follow these simple steps:
- Step 1: Download the Navi app.
- Step 2: Open the app and register with your mobile number.
- Step 3: Upon registering, click on “Home Loan.”
- Step 4: Now, submit the property details, like location, type, and address of the property.
- Step 5: After submission, check your home loan eligibility by providing your PAN and other details.
- Step 6: Once you submit the required documents and the same are verified, your home loan will be instantly approved.
How to Calculate EMI for a Home Loan in Bangalore
You can use an online home loan EMI calculator to check your monthly repayment obligations. All you need to do is enter the loan amount, tenure, and interest rate to check your monthly repayment obligations.
Loan Amount
Rate of Interest (P.a)
%
Loan Tenure (Years)
Years
Monthly EMI
0
Total Interest
Total Amount
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Points to Remember Before Taking a Home Loan in Bangalore
- Floating vs fixed rate: Floating rate loans are subject to market fluctuations. If your lender increases the rate, your home loan rate will be affected. However, during rate cuts, you could enjoy lower interest rates. For fixed rates loans, the interest rate remains unaffected. So, consider these factors before taking a home loan.
- Down payment: As per the RBI guidelines, lenders in India can only provide 80% of the property value as a home loan for loans above Rs.30 lakh. So, the more money you pay as down payment, the lower your EMIs will be. However, with Navi, you can get loans up to 90% of the property value irrespective of the loan size.
- Home loan eligibility: Factors such as your credit score, income, existing liabilities, age and loan tenure decide how much loan you can get. It is better to keep a check at the said factors before applying for a home loan.
- Credit score: You need maintain a good credit score to get preferential rates. Lenders prefer a credit score of 750 or higher, primarily because this parameter determines the borrower’s creditworthiness.
- Additional fees & charges: Besides interest rates, you should also check out the processing fees, late payment penalties and foreclosure/prepayment charges applicable on your loan. You should also be aware of the hidden charges.
Final Word
Buying a house is a huge step in anyone’s life. To get you closer to achieving that goal, home loans are the most suitable borrowing option. The beautiful city of Bangalore is home to most of India’s IT giants. Fortunately, home loans in Bangalore are affordable and offered at low-interest rates so that you can also make this city your home. The decision to take this loan is also crucial and requires extensive financial planning. To make this task simpler, you can access Navi’s easy-to-use home loan EMI calculator.
FAQs
Ans: In case you have a lump sum amount with you, you can utilise it to foreclose your home loan. An outstanding loan amount means paying monthly instalments, which includes the interest component. You can free yourself from this additional cost by prepaying the remaining loan amount. However, you should consider the foreclosure charges levied by lenders before making this decision.
Ans: When you apply for a home loan with a co-applicant, the likelihood of your loan getting approved increases. Most lenders charge a lower interest rate if there are co-applicants. Moreover, you and your co-borrower can both enjoy tax benefits on your respective incomes.
Ans: There are numerous reasons behind a home loan getting rejected. It can be that you have too many loans, or your credit score is bad. The rejection might also be because you applied for a loan and EMI amount that is too high for your income slab.
Ans: One type of home loan is a home improvement loan, which can be used for renovating or improving your house. If you have an existing home loan, you can obtain a top-up loan and use it for the same purpose.
Ans: The minimum income requirement varies across lenders and cities and can be between Rs. 15,000 and Rs. 45,000. For metropolitan cities like Bangalore, this requirement is generally set at Rs. 25,000 per month.
Before you go…
Are you looking to buy that house you’ve been eyeing 🏠 and you need a loan of up to ₹5 crore. Install the Navi app now and get instant in-principle approval right away! Interest rates starting at 8.74% p.a.
Disclaimer: This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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