Best bank to get the home loan

[Sagar]

Hi All,

Planning to apply for a home loan very soon. My current cibil is 795 and the simulator shows that my score will increase to 805 if I apply for a home loan.
Can someone please help me with
1) which bank to choose?
2) floating or fixed as per current interest rates?
3) should I hold on applying for new cc for some time or it doesn't affect my loan application?
4) will it help me reduce my interest rates if I open a high NRV account with the bank?
5) any other suggestion/ advice

 

[Mogambo]

HDFC is a unique home loan provider. They will never reduce the ROI on their own. You must challenge them by quoting other lenders. They will then ask you to pay a conversion fee each time they reduce the ROI. This could be ₹ 2500 up to ₹ 5000 each time. Also, they have issues with pre-payment of loans. May vary case to case though! SBI is much better in home loan aspect. Lower rates, daily reducing, online prepayments allowed, no prepayments penalty. Taking a loan from a scheduled bank (PSU or Pvt) is always better. Learned the hard way!

Yes that's why i suggest psu banks like sbi, union Bank. Hdfc(even though it's my primary bank) i did not take loan from them. It charges for a lot of things. Once you enter maze then only you will get to know. I feel sorry for you Digvijay, one solution for you is transfer to sbi. Btw i am being charged 9%. What is rate in hdfc

 

[caabhi]

1. Quotes hold 0 value.
4. How do you negotiate interest of home loan. please Explain yourself.(i believe you haven't taken home loan till now)

1. There are multiple sites wherein you get to know the ongoing rates. You can simply call any DSA who can let you know all the rate at once.
4. Word negotiate is self explanatory. I am not here to prove anything, just to share my experience if it is of any help. Just to answer your question though, I have taken home loan more than once plus helped many of my friends and colleagues to get one.

 

[caabhi]

Yes that's why i suggest psu banks like sbi, union Bank. Hdfc(even though it's my primary bank) i did not take loan from them. It charges for a lot of things. Once you enter maze then only you will get to know. I feel sorry for you Digvijay, one solution for you is transfer to sbi. Btw i am being charged 9%. What is rate in hdfc

My friend recently got loan transferred to hdfc at 8.35%. loan ticket size and credit score might be reason for variation in roi. But safe to say around 8.5%

 

[Mogambo]

1. There are multiple sites wherein you get to know the ongoing rates. You can simply call any DSA who can let you know all the rate at once.
4. Word negotiate is self explanatory. I am not here to prove anything, just to share my experience if it is of any help. Just to answer your question though, I have taken home loan more than once plus helped many of my friends and colleagues to get one.

4. My point being you can't negotiate interest rate for home loan. They are fixed on credit score excluding concessions like female ownership. If bank reduces int believe me they told you higher rate then decreased

 

[elite34700]

What was your experience with IndusInd Bank?

IndusInd bank doesn’t have an idea of home loans at first post which incorrect detailing and they’ll lure you into getting lower interest rates. Post which, in the end they play the insurance game stating insurance is mandatory. Worst bank in india you can go to for a home loan.

 

[Ankur dhanda]

I mentioned it as i had recently taken a home loan from them. I apparently had a decent experience. No insurance was forced to me, being a IndusInd pioneer customer negotiable rate and processing fees. Got it at 8.65 %( 6.5 + 2.15).
Now axis offering me balance transfer at 8.5% without any processing fees. Still reviewing the offer.

 

[technom]

Yes that's why i suggest psu banks like sbi, union Bank. Hdfc(even though it's my primary bank) i did not take loan from them. It charges for a lot of things. Once you enter maze then only you will get to know. I feel sorry for you Digvijay, one solution for you is transfer to sbi. Btw i am being charged 9%. What is rate in hdfc

HDFC has been good to us. We are at 8.35% (courtesy of good credit score of over 800) and none of my friends/colleagues faced any major issues in recent times.

I like the fact they offer lower interest rates for a fixed fee of around 3k. You can check once in every 3 months or whatever there's a major rate change by RBI and there's a good chance they'll have some new offer.

I know a lot of friends and colleagues with other lenders such as SBI at around 9-10% and sometimes more. Most lenders are very reluctant to change rates for existing customers but HDFC isn't. They try to give the best rates in my personal experience.

In the end it all come down to the spread (margin that lender keeps) and it's around 1.85% for us.
6.5 + 1.85 = 8.35% is the very best spread as far as we know

 

[technom]

4. My point being you can't negotiate interest rate for home loan. They are fixed on credit score excluding concessions like female ownership. If bank reduces int believe me they told you higher rate then decreased

Not really. We were able to negotiate based on our relationship. It's not going to be radically different from others but even a 0.05% is very beneficial in home loans.

We've always enjoyed a relatively lower interest rates compared to most others in our circle.

In the end our loyalty has always been to lenders and banks which offer the most value. We are up to date on the offers out there and always negotiate for the best in market

 

[Mr. Aman]

okay there are many different options from different banks I'll have home loan from icici when I'll take the give me at 2.7 spread but now after to much effort the reduce it to 2.35 , is there any better option i can take to reduce it more
currently is 6.5+2.35= 8.85

 

[technom]

okay there are many different options from different banks I'll have home loan from icici when I'll take the give me at 2.7 spread but now after to much effort the reduce it to 2.35 , is there any better option i can take to reduce it more
currently is 6.5+2.35= 8.85

Different banks treat customers differently.
What usually works is the threat to customer care or RM that you have better offer (say 8.35% from HDFC with processing fee waiver) and will move away unless they match the offer. Sometimes this works and others times not so much.

What I do know is SBI/LIC and other public banks don't budge easily and will let you go but private banks, especially with good relationship will try to retain with counter offer. This is purely based on hear say whole trying to help our friends & colleagues with better home loan spreads

 

[Ankur dhanda]

HDFC has been good to us. We are at 8.35% (courtesy of good credit score of over 800) and none of my friends/colleagues faced any major issues in recent times.

I like the fact they offer lower interest rates for a fixed fee of around 3k. You can check once in every 3 months or whatever there's a major rate change by RBI and there's a good chance they'll have some new offer.

I know a lot of friends and colleagues with other lenders such as SBI at around 9-10% and sometimes more. Most lenders are very reluctant to change rates for existing customers but HDFC isn't. They try to give the best rates in my personal experience.

In the end it all come down to the spread (margin that lender keeps) and it's around 1.85% for us.
6.5 + 1.85 = 8.35% is the very best spread as far as we know

1.85 is a very good spread.
Anything mentioned in their terms about changing the spread after couples years due to operational costs or when significant changes in credit score?
Axis mentions that in their documents

 

[technom]

1.85 is a very good spread.
Anything mentioned in their terms about changing the spread after couples years due to operational costs or when significant changes in credit score?
Axis mentions that in their documents

Terms are always going to be in favour of the banks but at least customer care tells you that the spread will not change for the rest of the tenure. Rate movements will happen based on RBI directives but the variance between different loan accounts will remain

 

[Mogambo]

HDFC has been good to us. We are at 8.35% (courtesy of good credit score of over 800) and none of my friends/colleagues faced any major issues in recent times.

I like the fact they offer lower interest rates for a fixed fee of around 3k. You can check once in every 3 months or whatever there's a major rate change by RBI and there's a good chance they'll have some new offer.

I know a lot of friends and colleagues with other lenders such as SBI at around 9-10% and sometimes more. Most lenders are very reluctant to change rates for existing customers but HDFC isn't. They try to give the best rates in my personal experience.

In the end it all come down to the spread (margin that lender keeps) and it's around 1.85% for us.
6.5 + 1.85 = 8.35% is the very best spread as far as we know

I checked it is showing 8.5% for HDFC. Can you check again. Banks are quick to revise Int. What is diff bw Special and Standard home loan in hdfc

 

[technom]

I checked it is showing 8.5% for HDFC. Can you check again. Banks are quick to revise Int. What is diff bw Special and Standard home loan in hdfc

Hoping the attached screenshot will help you.

I don't know the difference between Special and Standard home loans but do recall the bank executives using the term 'special rates for women applicant (even as add on) when we took the loan and that was around 0.05% better rate than for normal applications

 

[Mogambo]

Ok now i got it. This is hdfc ltd. I was checking hdfcbank.

 

[technom]

Ok now i got it. This is hdfc ltd. I was checking hdfcbank.

It's going to be the same very soon. Besides HDFC Bank only upsells loans from HDFC Ltd. They don't have their own home loan products

I found this article a few days ago, good read for people on the benefits of NBFC vs. Banks for home loans:- https://emicalculator.net/got-a-home-loan-from-hdfc-how-does-the-hdfc-hdfc-bank-merger-affect-you/

Summary: Just keep checking for better rates with NBFC regularly. They're the best when it comes to low spreads for salaried people with very good credit scores of over 800 or closer

 

[Mogambo]

It's going to be the same very soon. Besides HDFC Bank only upsells loans from HDFC Ltd. They don't have their own home loan products

I found this article a few days ago, good read for people on the benefits of NBFC vs. Banks for home loans:- https://emicalculator.net/got-a-home-loan-from-hdfc-how-does-the-hdfc-hdfc-bank-merger-affect-you/

Summary: Just keep checking for better rates with NBFC regularly. They're the best when it comes to low spreads for salaried people with very good credit scores of over 800 or closer

Thanks man. I should check out nbfc. I had misconception that better intrest rates follow this order private bank>nbfc. Mine is around 760 to 800. I visited many banks i found ubi offered lowest rate. sbi=hdfc .25% higher than ubi but chose sbi even hdfc being my primary acc(heard people getting charged xtra).

 

[jack333]

Is hdfc always charging extra to decrease the interest rate when repo rate decreases? And what about ubi or sbi?

 

[Max]

HDFC has been good to us. We are at 8.35% (courtesy of good credit score of over 800) and none of my friends/colleagues faced any major issues in recent times.

I like the fact they offer lower interest rates for a fixed fee of around 3k. You can check once in every 3 months or whatever there's a major rate change by RBI and there's a good chance they'll have some new offer.

I know a lot of friends and colleagues with other lenders such as SBI at around 9-10% and sometimes more. Most lenders are very reluctant to change rates for existing customers but HDFC isn't. They try to give the best rates in my personal experience.

In the end it all come down to the spread (margin that lender keeps) and it's around 1.85% for us.
6.5 + 1.85 = 8.35% is the very best spread as far as we know

I agree you have got a very good spread from HDFC, kudos on negotiating that - 1.85% is the lowest even I have heard.

The interesting thing is when the RBI hikes rates, HDFC revises rates automatically, but when RBI lowers rates you have to pay a conversion charge (3-5K) and make a request to HDFC, which is where I disagree with your assessment - e.g. my SBI loan revises automatically without me needing to make a request or pay conversion charges. I feel this is material information for anyone considering an HDFC loan should be aware of.

 

[technom]

I agree you have got a very good spread from HDFC, kudos on negotiating that - 1.85% is the lowest even I have heard.

The interesting thing is when the RBI hikes rates, HDFC revises rates automatically, but when RBI lowers rates you have to pay a conversion charge (3-5K) and make a request to HDFC, which is where I disagree with your assessment - e.g. my SBI loan revises automatically without me needing to make a request or pay conversion charges. I feel this is material information for anyone considering an HDFC loan should be aware of.

Not really.. please check my screenshots.
I paid only two times in my recent history with HDFC Ltd. Every other time the company increased but also reduced the interest on their own but only thing is the "SPREAD" will never change with normal interest rate movements.
This is why I call HDFC Ltd once in 3 months (or when major rate change happens) to check if they have better offers and if there is, then you pay to get that better rate. A nominal fee of around 3k is reasonable for me if my spread can reduce by even 0.2 to 0.1% but in this case it was even more and so big benefit.

Another fact is that the banks will offer better spreads only when the interest rates are increasing drastically, so the trick is to obtain and lock lower spreads at that time and stay there.

HDFC is very transparent in this terms and at least gives you this option (even to normal customers with good credit card). Try the same with SBI or other public banks and you'll not get those low spreads even if you're credit score is 850.
Again, everything I say is based on my personal experience and comparison with my immediate friends/family loan accounts. It's how it works to the best of our knowledge because I've actively shopped around with several banks both for myself & others. Please do your own research in the region before committing to any Bank or NBFC to ensure you get the best offers. Good Luck !