Leading Home Loan Companies/ Banks in India

Leading Home Loan Companies/ Banks in India
For your Home Loan you have a wide rang of choices, There are many Public Sector Banks, Private Sector Banks & Housing Finance companies who are reay to finance your home loan. Following are few listing of some major Home Loan companies In India.
Public Sector Banks	Private Sector Banks	Housing Finance Companies
1. Allahabad Bank	1. Bank of Rajasthan Ltd.	1. AIG Home Finance India Ltd.
2. Andhra Bank	2. Citibank N.A.	2. BHW Home Finance Ltd.
3. Bank of Baroda	3. Development Credit Bank Ltd.	3. Can Fin Homes Ltd.
4. Bank of India	4. Dhanalakshmi Bank Ltd.	4.Cent Bank Home Finance Ltd.
5. Bank of Maharashtra	5. Federal Bank Ltd.	5.Dewan Housing Finance Corporation Ltd.
6. Canara Bank	6. HSBC Ltd.	6.DHFL Vysya Housing Finance Ltd.
7. Central Bank of India	7. ICICI Bank Ltd.	7. GE Money Housing Finance
8. Corporation Bank	8. IndusInd Bank Ltd.	8. GIC Housing Finance Ltd.
9. Dena Bank	9. ING Vysya Bank Ltd	9. GRUH Finance Ltd.
10. Indian Bank	10.Jammu and Kashmir Bank Ltd.	10. HUDCO
11. Indian Overseas Bank	11. Karnataka Bank Ltd.	11. HDFC Ltd.
12. IDBI Bank Ltd.	12. Karur Vysya Bank Ltd.	12.ICICI Home Finance Company Ltd.
13. Oriental Bank of Commerce	13.Kotak Mahindra Bank Ltd.	13. IDBI Home Finance Ltd.
14. Punjab & Sind Bank	14. South Indian Bank Ltd.	14. Indiabulls Housing Finance Ltd.
15. Punjab National Bank	15.Standard Chartered Bank Ltd.	15. LIC Housing Finance Ltd.
16. State Bank of India	16. Axis Bank Ltd.	16.Mahindra Rural Housing Finance Ltd.
17. State Bank of Bikaner and Jaipur	17. Yes Bank Ltd.	17.Manipal Housing Finance Syndicate Ltd.
18. State Bank of Hyderabad	18. Lakshmi Vilas Bank Ltd.	18.National Trust Housing Finance Ltd.
19. State Bank of Indore		19. PNB Housing Finance Ltd.
20. State Bank of Mysore		20. Repco Home Finance Ltd.
21. State Bank of Patiala		21.Sahara Housing Finance Corporation Ltd.
22. State Bank of Saurashtra		22.Sundaram BNP Paribas Home Finance Ltd.
23. State Bank of Travancore
24. Syndicate Bank
25. UCO Bank
26. Union Bank of India
27. United Bank of India
28. Vijaya Bank

What are the tax benefits of home loans?

The tax benefits of home loans

Both principal as well as interest of home loans attract tax benefits. With effect from 1st April 2005 (i.e. From assessment year 2005-07) under section 80C of the Income Tax Act 1961.

Interest paid on the home loan: As per Sec 24(b) of the Act, a deduction up to Rs. 150,000 towards the total interest paid on the home loan towards purchase / construction of house property can be claimed while computing the income from house property (The deduction stands reduced to Rs.30,000 in case of loans taken prior to March 1, 1999) for the self-occupied property & if the property is rented out than there is no such limit & the actual interest paid on the home loan of the property is eligible for deduction. The interest payable for the pre-acquisition or pre-contruction period would be deductible in five equal annual installments commencing from the year in which the house has been acquired or constructed.

In case of self occupied property, this deduction is allowed only for one such self - occupied property. The interest towards home loan taken for purchase, construction, repairs, renewal or reconstruction of house property is also eligible for deduction under section 24(b). But the interest paid on purchase of plot is not eligible. Deduction is allowed is only for purchase/construction of House Property.

Principal repayment of the home loan: As per Section 80C along with section 80CCE of the Income Tax Act, the principal repayment up to Rs. 100,000 on your home loan will be allowed as a deduction from the gross total income subject to fulfillment of some prescribed conditions.

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Term & Rate of Interest for a Home loan to be chosen

Term & Rate of Interest for a Home loan to be chosen

Term: A maximum term of 25 years is allowed for mortgage but in a study its shows that most of the Indian borrower prefers to go for 20 years term period. The general consensus seems like if you can afford a 10-15-year loan, you should go for it. The interest rate will be lower, you own your home in at an early stage, and the payments aren't actually that much higher. Just for an example if you choose a term of 15 years instead of 20 years yours EMI will be higher by 10.30% than what you will be paying for 20 years but your term gets reduced by 25%.

Interest Rate: The rate is suggested to be a fixed rate of interest. The fixed rate of interest seems to be a bit higher than floating at the initial stage but it shows in a study that floating rate of interest becomes higher than then the fixed rate of Interest over the period after it goes for 2-3 reviews by the bank/company. The floating rate looks to be a lucrative at the initial stage but banks/company takes it to a higher rate by changing its policies at the time of each review of Interest. Normally floating Interest rate goes for a review at every 3 months interval.

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What is My Home Loan Eligibility

What is My Home Loan Eligibility

Most companies give home loan up to a maximum of 85% of the cost (including the registration cost) of the house for a loan upto Rs.20 Lakhs & 80% of the cost above Rs. 20 lakhs. However in case of Plot purchase the maximum 75% of the cost of the loan is being financed. Balance 15%/20%/25%, sometimes called 'seed money', has to be invested by the loan applicant upfront from its own sources.

The amount, for which the applicant is eligible, is determined by the age, income, no. of dependents, monthly outgoing and repayment capacity. Normally the companies/Bank consider house loan upto 50% MLSC (Monthly Loan Servicing Charge i.e, EMI) of the net income of the applicant. However the MLSC can go high depending upon the Profile, age, No. of Dependents of the applicant.

Calculation of the Monthly net income is done for Individuals having salaried Income is the current salary he/she is getting in his bank accounts, other parks may be included depending upon the company/banks Policy at some discounted value. For the Individuals having business income is the average of 3 years ITR. Capital Gain & any other income of inconsistent in nature is not considered while income calculation of the applicant. Furthermore the current loan EMI the applicant is paying is also been deducted from the income while appering at the eligible income.

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Other Costs That Usually Accompany Your Home Loan

Additional Costs That Usually Accompany Your Home Loan

Home loans usually attract following extra costs:

1) Processing Fees: It's a fee payable to the lender on applying for a loan. It is either a fixed amount or may be a percentage of the loan amount applied for.

2) Pre-payment Penalties: When a loan is paid back before the end of the agreed duration, a pre-payment charge is demanded by some banks/companies, which is usually between 1% and 2% of the amount being pre-paid. However, Now prepayment charge on prepayment from own source is exempted by the circular of NHB. Now prepayment charge is applicable only on takeover cases.

3) Commitment Fees: Some institutions levy certain percentage as commitment fee in case the loan is not availed of within a stipulated period of time after it is processed and sanctioned. This charge is lavied on the undisbursed amount of Loan.

4) Miscellaneous Costs: It is quite possible that some lenders may levy documentation or consultant charges.

5) Registration of mortgage deed

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Different type of interest rates offered for home loans?

Different type of interest rates offered for home loans? 

Interest rates vary from institution to institution as detailed in my 1^st post. The interest on home loans in India is usually calculated on monthly reducing balance. In some cases, daily reducing basis is also adopted.

Annual reducing: In this system, the principal, for which you pay interest, reduces at the end of the year. Thus you continue to pay interest on a certain portion of the principal which you have actually paid back to the lender through EMIs paid during the year. This means the EMI for the monthly/Daily reducing system is effectively less than the annual reducing system.

Monthly reducing: In this system, the principal, for which you pay interest, reduces every month as you pay your EMI.

Daily Reducing: In this system, the principal, for which you pay interest, reduces from the day you pay your EMI. EMI in the daily reducing system is less than the monthly reducing system & is better from the point of view of the customer.

So, before choosing any Institution for taking loan not only go by the lucrative rate of Interest offered by that Institution but also inquire about the balance reducing method applied by the Institution to calculate the actual effective rate of Interest.


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Eligibility conditions for a home loan

Eligibility conditions for a home loan

To qualify for a home loan, most of the lending institutions in India require you to be:

a)     An Indian resident or NRI

b)     Above 21 years of age at the commencement of the loan

c)      Below 65/70 years (depending upon the Institutions) or retirement, in case of salaried persons, when the loan matures

d)     Either salaried or self employed and 

e)     Good Creditworthy profile

f)       Clear CIBIL Report

We will discuss later on regarding CIBIL Report & Eligibility for getting Home Loan leading Institute wise.


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