Home Loan Interest Rates

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Home Loan Interest Rate

Interest rate is important when you apply for Home Loans in India. Your Home Loan interest rate can affect the overall EMI that you have to pay. With Kotak Home Loan, you can get an attractive interest rate starting @ 7.99%* p.a. Here's more:

Frequently Asked Questions

What is the current housing loan interest rate?

The Home Loan interest rate in India varies depending on factors such as the loan amount, tenure, and applicant's credit profile. The current Home Loan interest rate at Kotak Mahindra Bank starts at 7.99%* p.a..

What are the different ways for calculating interest rate payments?

There are two ways of calculating interest rate payments namely Simple interest and Compound interest.

How do you reduce the Home Loan interest rate?

You can reduce the home loan interest rate by improving your credit score, negotiating with lenders, or making a larger down payment.

Does credit score affect home loan interest rate?

Yes, a higher credit score generally results in lower home loan interest rates, as it indicates to lenders that you are a reliable borrower.

What is the minimum rate of interest for a home loan?

The minimum home loan interest rate can vary by lender, but it usually starts around 7.00% p.a. to 8.00% p.a. in India, depending on market conditions and borrower profile.

Customer Type	Effective Rate Of Interest
Floating Category (Repo Rate: 5.50% p.a.)
For Salaried & For Self-employed	7.99%* p.a. onwards
For existing customers switching from an Adjustable Interest Rate to a Fixed Rate*	12% p.a. onwards (Fixed Rate)
For existing customers switching from a Fixed Rate to an Adjustable Interest Rate*	ROI applicable would be the then prevailing floating rates, linked to External Benchmark Lending Rate (Repo Rate) only

*Note: Switch and Foreclosure Charges will be applicable on Fixed Rate Loans as mentioned in General Schedule of Features and Charges (GSFC).

How to Calculate Interest on Home Loan?

An error-free and easy way to calculate home loan interest and EMIs on a home loan is by the Kotak Home Loan EMI Calculator. Just enter the amount you want to borrow, the tenure you want, and the rate of interest you prefer.
To calculate the interest on a home loan, you can use the EMI formula-

EMI=P * r * (1 + r)^n / ((1 + r)^n - 1)

Where,

- P = Principal loan amount

- r = Monthly interest rate (annual rate divided by 12)

- n = Loan tenure in months

For example,

For a home loan of Rs. 50,00,000 at an annual interest rate of 8.6% for 20 years (240 months). Now using the above EMI formula, EMI=P * r * (1 + r)^n / ((1 + r)^n - 1)

EMI≈ Rs. 43,867

Thus, your monthly EMI would be approximately Rs. 43,867. This formula helps you understand your monthly payments clearly .

Types of Home Loan Interest Rates

Home loan interest rates in India can be fixed or floating. Find out what this means and how these types of house loan interest rates differ from one another.

Aspect	Fixed Interest Rate	Floating Interest Rate
Stability	Constant throughout the loan tenure	Fluctuates with market rates
Payment Predictability	Known monthly payments	Payments may vary
Initial Rates	Generally higher (1-2.5% more)	Generally lower
Market Impact	Unaffected by market changes	Affected by changes in market rates
Benefit from Decrease	No benefit when rates drop	Benefit from lower rates when market falls
Risk	Lower risk due to fixed payments	Higher risk with potential payment increases

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Disclaimer (Things you should know):

For loans: Credit at the sole discretion of the Bank and subject to guidelines issued by RBI from time to time. Bank may engage the services of marketing agents for the purpose of sourcing loan assets.

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