Home loan options in India compared
Interest rate types, lender types and repayment options, compared on how they work and what to watch out for.
This table compares types of rates, lenders and repayment structures for home loans in India. It does not rank lenders or show live rates, because your rate depends on your credit profile, income, loan amount, property and the lender's current pricing. Use it to decide what kind of offer to ask for, then compare actual offers with the EMI calculator and the balance transfer calculator. Select a column header to sort, or filter the table by keyword.
Select a column header to sort.
| Option | How it works | Good for | Watch out for |
|---|---|---|---|
| Repo-linked floating rate (EBLR) | Rate = external benchmark (usually the RBI repo rate) + spread; reset at least once every three months | Most new borrowers from banks; rate cuts reach you quickly | Rate rises reach you quickly too; check whether the lender changes EMI or tenure |
| MCLR-linked floating rate | Rate = lender's marginal cost of funds based lending rate + spread; reset typically every 6 or 12 months | Borrowers with older loans who have compared and found the rate competitive | Cuts pass through slowly; many old MCLR loans are now dearer than the lender's EBLR loans |
| Fixed rate for a period | Rate fixed for an initial period (often a few years), then converts to floating | Borrowers who need certainty for the first years | Usually priced higher than floating; prepayment charges may apply while fixed; read the conversion clause |
| Fully fixed rate | Rate fixed for the whole tenure | Rarely offered for long tenures; certainty if available | Higher starting rate; prepayment charges are allowed on fixed-rate loans |
| Bank | Scheduled commercial bank lending under RBI rules; new floating loans are linked to an external benchmark | Salaried borrowers with clean credit and standard properties | Stricter documentation; bundled insurance or account requirements |
| Housing finance company (HFC) | Company registered with and regulated by RBI, supervised by the National Housing Bank; sets its own benchmark (often called a prime lending rate) | Self-employed borrowers, informal income, smaller towns, unusual properties | Benchmark is set by the HFC itself, so check how it has moved compared with the repo rate |
| Balance transfer | New lender pays off your old loan and takes over the mortgage | Large outstanding balance and many years left with a meaningful rate gap | Switching costs and new insurance can wipe out the saving; check break-even |
| Conversion with existing lender | Your lender moves your loan to its current benchmark or lower spread for a fee | Old MCLR or base rate loans with an otherwise satisfactory lender | The conversion fee; confirm the new spread in writing |
| Overdraft-linked home loan | Surplus money parked in a linked account reduces the balance on which interest is charged | Borrowers with irregular income or large cash balances | Usually a higher rate than a standard loan; discipline needed not to withdraw surplus |
| Step-up repayment | EMI starts lower and rises in later years as income is expected to grow | Young salaried borrowers with expected pay increases | More total interest; risk if income does not rise as planned |
Rules summarised here reflect RBI instructions as of October 2026, including the external benchmark requirement for new floating-rate retail loans from banks since 1 October 2019 and the Key Fact Statement for retail loans since 1 October 2024. Check current details at the Reserve Bank of India and, for housing finance companies, the National Housing Bank. Your loan agreement and Key Fact Statement are the documents that bind your lender. This comparison is general information, not financial advice.