Idbi Bank Home Loan Interest Rate at 8.40% onwards

How to apply home loan from IDBI Bank under Pradhan Mantri Awas Yojana (PMAY)?

First of all, you apply for home loan from IDBI Bank and along with your loan application, you need to fill the Pradhan Mantri Awas Yojana (PMAY) Form and submit it with your loan application form with the bank. Bank will take care of its processing. Bank will check your eligibility and if you are eligible in the category you have applied for like EWS/ LIG/ MIG-I/ MIG-II, then accordingly the interest subsidy would be credited in your bank account.

(3) IDBI Bank Balance Transfer of Home Loan : This scheme enables a customer to transfer home loan from any other institution to IDBI Bank.

You can pay off any existing balance of home loan with IDBI Bank Home Loan Balance Transfer at a lower rate of interest. Retain your home on terms and conditions that suits your needs.

You can also top-up the existing loan to get ready cash for any of your needs.

Avail IDBI Bank Home Loan Transfer, if:

• You are trying to reduce your interest rate and lower your payments
• Willing to reduce your home loan term to pay off your loan faster
• You want to use the equity in your house to get money for any of your needs

Takeover norms from other Banks / Financial Institution:

1. Repayment Track Record for a minimum period of 6 months is required
2. Facility of additional funds in the form of Top Up is available
3. Top up facility up to 100% of the original sanction at Home loan interest rates

Important Features:

1. Customer should satisfy the eligibility criteria for availing Home Loan as per IDBI Bank 's instruction
2. Customer has serviced interest and/or instalment of the existing loan regularly, as per the original terms of sanction
3. Customer should have valid documents evidencing the title to the house/ flat
4. Processing Fee: 0.50% of the loan amount, subject to minimum Rs 2,500
5. Maximum Tenure: Repayment period of up to 30 years.
6. Security: Equitable| registered mortgage of the property. If mortgage is not feasible, bank at its discretion can accept security in the form of Insurance Policies, Govt Promissory Notes, Shares and Debentures, Gold Ornaments etc.
7. Interest Rates:

   Interest Rate (p.a.) Salaried/ Self Employed- Professional	Interest Rate (p.a.) Self Employed-Non-Professional
   8.40%-10.75%	8.50%-12.25%

(4) IDBI Bank Top-Up Home Loan: HDFC Bank offers customers to borrow certain amount over and above their home loan amount.

Important Features:

1. Eligibility Criteria: Customer should already have a HDFC Bank Home Loan Account
2. Processing Fee: 0.50% of the loan amount, subject to minimum Rs 2,500
3. Margin:20% to 25%
4. Maximum Tenure: Repayment period of up to 30 years.
5. Loan Amount: Customised, Depending on repayment capacity of the borrower and value of property.
6. It can be availed for any personal purpose
7. The interest rates are much lower than usual personal loan interest rates.
8. Interest Rates:

   Purpose	Interest Rate (p.a)
   Housing purpose	Prevailing Home Loan Rate + 0.20%
   Non Housing purpose	Prevailing Home Loan Rate + 0.75%

(5) IDBI Bank Home Extension Loan (HEL): HEL is offered for adding more space to your existing home for meeting the requirements of your growing family.

Important Features:

1. Purpose:To extend your home anyway you like
2. Eligibility: Resident Indians, Non-Resident Indians (NRIs), Persons of Indian origin (PIOs), Overseas Citizens of India (OCI) - Individuals, corporate.
3. Processing Fee: 0.50% of the loan amount, subject to minimum Rs 2,500
4. Loan Amount: Customised, Depending on repayment capacity of the borrower and value of property.
5. Margin:20% to 25%
6. Security: Equitable| registered mortgage of the property. If mortgage is not feasible, bank at its discretion can accept security in the form of Insurance Policies, Govt Promissory Notes, Shares and Debentures, Gold Ornaments etc.
7. Interest Rates:

   Interest Rate (p.a.) Salaried/ Self Employed- Professional	Interest Rate (p.a.) Self Employed-Non-Professional
   8.40%-10.75%	8.50%-12.25%

(6) IDBI Bank Home Loan Interest Saver: This is a scheme for saving the interest by linking your home loan account with Flexi Current Account.

The interest liability of your home loan comes down to the extent of surplus funds parked in the operative current account. You will be allowed to withdraw or deposit funds from this operative current account as and when required. Interest on Home loans will be calculated on outstanding balance of loan minus balance in the Current Account based on EOD balance.

Important Features:

1. Purpose: To purchase a Plot for construction of a House, to purchase/ construct house/ flat, as well as for renovation/ repair/ alteration/ addition to house/ flat, etc.
2. Eligibility: Salaried and self employed having regular income in the age group of 21 years to 60/65 years
3. Processing Fee: 0.50% of the loan amount, subject to minimum Rs 2,500
4. Loan Amount: Customised, Depending on repayment capacity of the borrower and value of property.
5. Advantage of Home Loan Interest Saver:
   • Use the Flexi Current Account to deposit your excess savings, annual bonus etc. You will have the flexibility to withdraw the idle/surplus money deposited in Flexi Current Account at any point of time
   • Just deposit these funds into your Flexi Current Account and enjoy interest saving on your home loan to the extent deposited.
   • The Flexi Current Account can be used like a normal current account and you will be provided with a cheque book and an ATM Card. You will also have access to our online banking portal and our entire gamut of banking facilities
6. Margin:20% to 25%
7. Maximum Tenure: Repayment period of up to 30 years.
8. Security: Equitable| registered mortgage of the property. If mortgage is not feasible, bank at its discretion can accept security in the form of Insurance Policies, Govt Promissory Notes, Shares and Debentures, Gold Ornaments etc.
9. Interest Rates:

   Interest Rate (p.a.) Salaried/ Self Employed- Professional	Interest Rate (p.a.) Self Employed-Non-Professional
   8.40%-10.75%	8.50%-12.25%

Tax Benefits of availing Home Loan

There are two types of tax benefits associated with home loan for Resident Indians:

Repayment of the Principal Amount: One can get a Tax rebate under section 80C of the Income Tax Act on whole amount repaid by him in a financial year, maximum upto Rs. 1,50,000/- each financial year (Increased from 1 Lakh to Rs. 1.5 Lakh in Budget 2014).

Repayment of the Interest on Home Loan: Tax Benefit on Home Loan for payment of Interest is allowed as a deduction under Section 24(1) of the Income Tax Act. One is eligible for a Tax Rebate of maximum of Rs. 2 lakh per financial year for home loan interest paid by him/her during that financial year.

What is the Impact of MCLR on EMI of IDBI Bank Home Loan Borrowers?

After April 1, 2016, all bank loans (including home loans) are linked to the bank's MCLR with or without a mark-up or spread (bank margin). Earlier, they were linked to the bank's base rate. All banks are required to disclose their MCLR each month.

Banks generally hike MCLR, whenever there is a hike in Repo Rate by the RBI. Banks may increase MCLR due to surging bond yields and higher provisioning requirements, even when the RBI has not hiked Repo Rate.

Home Loan Interest Rate can be equal to the MCLR or have a 'margin' or 'mark-up' or 'spread' but can never be lower than MCLR.

Home Loan Interest Rate is linked to the bank's MCLR. If MCLR goes up, the home loan rates will also go up. Home Loan Interest Rate will not be impacted by hike in MCLR only if banks reduce the mark-up (margin) in the home loan. If MCLR goes down, the home loan rates will also go down.

For MCLR-linked home loans, the rate is reset after 6 or 12 months according to the agreement between the borrower and the bank. The interest rate applicable on the reset date will become the new rate on which the future EMI's will be calculated.

What should Base Rate Home Loan Borrowers do?

Home Loan Interest Rate of old home loan borrowers (who had taken home loans before April 1, 2016) are linked to the base rates of the banks. Hence the EMI which they are paying is also linked to base rate. Banks have always remained very sluggish for passing on the benefits of RBI rate cuts to the borrowers.

Now after April 1, 2016, Home Loan Interest Rate is linked to MCLR (Marginal Cost of funds based Lending Rate) for home loan borrowers in order to resolve the problems of the Base Rate regime.

It will be beneficial for them to switch to MCLR linked rate if the difference between what they are paying (under base rate) and what the bank is offering (under MCLR) is significant. So they must switch to MCLR linked rates, if outstanding loan is high and the remaining tenure is also long.

In that situation, Base Rate Borrowers have following two options:

(1) Switch to MCLR linked home loan with the same bank: It is beneficial, in case the bank is charging a nominal switching fee such as 0.50% or less on outstanding amount.

(2) Transfer the loan to another bank on MCLR: It is feasible, if new bank has waived off processing fee (which they generally do in order to attract the customer and increase their business) or is charging very less processing fee and legal and transfer costs.

The borrower must compare both the above-mentioned options and opt for the one which is more beneficial to them in terms of money saved. It will result not only in reduction of future EMIs but also a huge amount of interest will be saved during remaining tenure.

One may as well continue the loan on base-rate especially if the maturity is near and need not go through the process of conversion.

Further, the Reserve Bank (RBI) is going to link the base rate for loans given by banks to the MCLR from April 1, 2018. Once it happens, the base rate will automatically increase or decrease along with the MCLR without any specific action required for adjustment. This will be very beneficial for the home loan borrowers whose rates (EMIs) are still linked to the base rate.

EMI Payment Methods of IDBI Bank Home Loan

You can repay IDBI Bank home loan in any of the following methods:

(1) Electronic Clearing Service (ECS): Electronic Clearing System is preferred for faster payments and collections. If you have an account with other bank than IDBI Bank then you can use ECS for loan repayment. You will have to fill up a form and submit the same with your bank for debiting EMI every month from your account. In this case, your EMI will be automatically debited every month from your bank account and credited to IDBI Bank towards loan repayment instalment.

(2) Standing Instruction (SI): If you maintain your account with IDBI Bank, then you can use this method. Under this method, you will have to issue a Standing Instruction to IDBI Bank to debit your EMI amount on a due date every month from your IDBI Bank account and credit to IDBI Bank loan account towards loan repayment instalment. You save a lot of time and energy by giving standing instructions to the bank to carry out the transaction on your behalf each time.

(3) Post-Dated Cheques (PDCs): In this method, you need to submit post-dated EMI cheques to IDBI Bank for a certain period of time, which are deposited by the IDBI Bank on the due date. This alternative is cumbersome and time-consuming and involve a manual procedure of visiting the IDBI Bank in a timely manner.

Points to Note Regarding EMI Payment Methods

1. A fresh set of PDCs need to be submitted in a timely manner.
2. Post Dated Cheques are accepted only for non-ECS locations.
3. It is good to pay your EMIs either through the Standing Instruction or ECS for faster and timely remittance of your loan instalments.

In case of Prepayment of IDBI Bank Home Loan, will EMI change?

One can pre-pay IDBI Bank Home Loan without any prepayment charges as it allows prepayment at nil charges in case of floating rate home loans. If the borrower makes a prepayment, the outstanding balance of principal amount of his home loan reduces. Then in that case he has following 2 options:

1. He can continue with the existing and reduce the loan tenure
2. He can reduce the EMI and keep the loan tenure the same

Out of above 2 options, first option is more beneficial for the borrower as he pay less interest to the bank as the pay off home loan will be faster.

Ways to Reduce your IDBI Bank Home Loan EMI

• Negotiate with your banker on lower interest rate
• Apply for longer tenure
• Give maximum amount as down payment
• Pre-pay loan amount
• Switch to another bank/ FI offering lower interest rate

Latest News on IDBI Bank Home Loan

• February 12, 2024: IDBI Bank revised MCLR rates w.e.f. 12.02.2024
• October 12, 2021: IDBI Bank keeps MCLR unchanged on 12.10.2021
• March 30, 2021: IDBI Bank eyes stake sales in subsidiaries
• January 29, 2021: IDBI Bank posts Rs 378-crore profit in Q3 FY21
• January 29, 2020: IDBI Bank to raise Rs 1,500 crore via Basel III Compliant Tier 2 bonds in order to fund growth
• January 15, 2020: Suresh Kishinchand Khatanhar takes charge as deputy Managing Director (MD) of LIC-controlled IDBI Bank
• December 20, 2019: IDBI Bank plans to raise up to Rs 2,000 crore through tier-II bonds
• June 20, 2018: SBI's B Sriram to take additional charge of IDBI Bank
• June 12, 2018: IDBI Bank hikes MCLR for tenures above 3 months by 5 to 10 basis points i.e. by 0.05% to 0.10%
• June 10, 2018: Government weighs various options to bring down stake in IDBI Bank
• February 7, 2018: IDBI Bank has reduced its home loan interest rates by 60 basis points for new home loan borrowers. The revised home loan interest rate now stands at 8.55 percent as compared to 9.15 percent earlier. The new rate is effective from 1st February, 2017.

FAQs on IDBI Bank Home Loan

1. What is an EMI?

   EMI or Equated Monthly Instalment is a fixed amount paid by you to the bank on a specific date every month. The EMI's are fixed when you borrow money from the bank as a loan. EMI's are used to pay both interest and principal amount of a loan in a way that over a specific number of years, the loan amount is repaid to the bank alongwith interest.

2. Is it possible to transfer my existing loan to IDBI Bank?

   You can transfer your existing Home Loan from any other financier to IDBI (Balance Transfer) and avail of additional refinance.

3. What is the benchmark applicable for housing loan?

   The benchmark applicable for home loan in IDBI Bank is 6 Month MCLR.

4. What is Pre-EMI Option?

   Pre-EMI is an option in which the borrower has to pay only interest on loan amount during the progress on the construction of the project. The actual EMI payment will be started only after his/ her possessing the house.

5. What are the various interest rates offered on home loans?

   Interest rates offered vary for women borrowers and others. Women borrowers are offered home loan at lower interest rate in IDBI Bank.

6. Can I club my income with others to avail Home Loans?

   Clubbing of income is allowed between spouse and parents and also for the cases where one of the applicants is salaried and other applicant is self-employed, subject to maximum clubbing of income of three applicants. This clubbing of income will be allowed between individuals related to each other as defined in the bank's policy.

7. What processing fee is charged by IDBI Bank home loan?

   IDBI Bank charges a low processing fee for its home loans which is as mentioned below:

   • 0.50% of the loan amount
   • Min. Rs. 2,500
   • Applicable tax will also be charged
8. What are the maximum number of properties that I can own?

   You can own as many properties as you want.

9. What is a down payment?

   Down payment is the amount that is paid by the borrower on an up-front basis. Banks usually pay around 75% to 85% of the cost of the property, hence the rest amount the borrower needs to pay as down payment.

10. What is the average tenure of a home loan?

    Home loans average tenure ranges generally between 3 and 30 years.

11. Can I pre-pay my IDBI Bank home loan? Is there any penalty?

    Yes. You can pre-pay your IDBI Bank home loan with nil penalty for floating rate home loan and with upto 2% of pre-payment penalty for fixed interest home loan.

12. What security do I need to furnish for IDBI Bank home loan?

    The property purchased out of the loan is taken by IDBI Bank as the security. However, if IDBI Bank feels then it can ask for additional securities too.

13. Who is an NRI?

    NRI or Non Resident Indian is a citizen of India or a foreign national of Indian origin living outside India for the purpose of employment, business or any other vocation, which would indicate his intention to stay outside India for an indefinite period of time. An Indian would also be termed as an NRI if his stay in India is less than 182 days.

14. What is the mode of payment for NRI home loans?

    Generally, payments are made through NRI Account like NRO, NRE, NRNR and FCNR accounts. NRI home loan can be paid by way of direct remittances from abroad through normal banking channels or from other financial accounts as may be permitted by RBI.

15. What kind of job makes me eligible for IDBI Bank home loan?

    You can either be a salaried employee or self-employed for obtaining this loan. However, the only condition is that you should be earning a regular income and should be able to furnish proofs of the same.

16. What is the tax benfits available on IDBI Bank home loan?

    As per Section 80C of the Income Tax Act, in case of the principal amount, you can claim a deduction of upto Rs 1.5 lakhs while in case of interest, it is upto Rs. 2 lakhs.

17. Are long-term home loans beneficial or short-term loans?

    It dependes on the financial status of the borrower. If he wants lower EMIs then Long-term loans, if not, then he can go with short-term loans with higher EMIs with the benefit of lesser interest.

18. Do I have to pay only fixed rate of interest or floating rate is also there in IDBI Bank Home Loan?

    No, you have the option to choose any kind of rate of interest you want to pay. You can pay floating rate of interest which is linked with the MCLR and keeps changing from time to time.

19. My EMI is increased due to an increase in the rate of interest being it flexible. What do I do for lower EMI?

    EMI increases with the increase in the rate of interest if you have opted for floating rate. You may ask your bank for increasing the loan tenure, if you want to get your EMI reduced or you can make some part pre-payment to your bank for reduction in EMI.

20. What are different modes of payment of EMI of IDBI Bank Home Loan?

    The EMI can be paid through various modes such as Post dated cheques, Electronic Clearing Service (ECS), Standing Instruction (SI), etc.

21. Can I apply for a home loan to renovate my home or flat?

    Yes, you can apply for home loan for any purpose such as buying a home, constructing a home, repairing of your home, home improvement, balance transfer and home renovation.

22. What is the difference between EMI and Pre-EMI?

    You repay your home loan through Equated Monthly Instalments (EMI), which includes principal and interest component. EMI repayment starts from the month subsequent to the month of final disbursement. Pre-EMI is only a simple interest, which you are required to pay every month till the loan is not fully disbursed.

23. How to get my Income Tax certificate from IDBI Bank?

    Income Tax certificate will be despatched to your after the end of financial year by IDBI Bank. You may also contact your nearest IDBI Bank branch or your can also send a request through its website for the same.

Contact details of Idbi Bank, Idbi Bank SMS balance check number SMS banking, Idbi Bank mobile banking, Idbi Bank toll free number,Idbi Bank toll free number 24*7, Idbi Bank miss call number.

• MISSED CALL NUMBERS - 18002094324, 1800221070, 022-67719100
• CUSTOMER CARE NUMBERS - 18002094324, 1800221070, 022-67719100
• CONTACT NUMBERS - 18002094324, 1800221070, 022-67719100

Idbi Bank Contact Details

• BANK OFFICIAL WEBSITE - https://www.idbibank.in
• CONTACT NUMBERS - 18002094324, 1800221070, 022-67719100
• EMAIL ID - [email protected]
• MISSED CALL NO. - 18002094324, 1800221070, 022-67719100
• CUSTOMER CARE NO. - 18002094324, 1800221070, 022-67719100
• TOTAL BRANCHES - 1717
• TOTAL ATMS - 3000
• HEADQUARTER - Mumbai
• BANK ADDRESS - IDBI Tower, WTC Complex, Cuffe Parade, Colaba, Mumbai 400005

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