Axis Bank Home Loan Interest Rate at 8.55% - 9.40% as on 01 Aug 2021

INTEREST RATE8.55% - 9.40%
LOAN TENURE30 Years
PROCESSING FEEUp to 0.50% of the loan amount subject to maximum Rs.10,000
GUARANTOR REQUIREDNo
PRE CLOSURE CHARGESNil

Calculate Axis Bank Home Loan EMI Calculate EMI Now

About Axis Bank

Axis Bank is a private sector bank in india with total assets 7475 crore. It has headquarter in Mumbai. Axis Bank was founded on 1994. It has 2589 branches and total assets 747512922 ATMs across India.

It provides all the financial services to its customers like saving deposit, fixed deposit, recurring deposit, home loans, personal loan, car loan, education loan, gold loan, PPF account, lockers, netbanking, mobile banking, RTGS, NEFT, IMPS, E-Wallet, Atal Pension Yojana, Pradhan Mantri Jandhan Yojana, Pradhan Mantri Suraksha Bima Yojana, Pradhan Mantri Jeevan Jyoti Bima Yojana and many more.

Find details about Axis Bank which includes Axis Bank Official Website, Axis Bank ATMs accross the India, Axis Bank Branches accross the India, Axis Bank Contact Numbers, Axis Bank official EmailID, Axis Bank Headquarter and Axis Bank Headquarter Address. Find Axis Bank Home loan purpose, Eligibility, Margin, Repayment of Home Loan ,Security, Document Required for Home Loan from below.

Other Products of Axis Bank:

Home Loan Personal Loan
Education Loan Business Loan
Car Loan Two Wheeler Loan
Gold Loan FD Interest Rates
RD Interest Rates Bank ATMs
PPF Account 

About Axis Bank Home Loan

ParticularsDescription
TypePrivate Sector Bank
IndustryBanking & Financial Services
Founded in1993
HeadquarterMumbai, Maharashtra, India
Websitehttps://www.axisbank.com/
ProductsRetail Banking, Corporate Banking, Finance, Credit Cards, Insurance, Asset Management, Wealth Management, Loans & Private Equity

Axis Bank is one of the largest private sector lenders in India. It has a brand image with rich 25 years of performance having millions satisfied customers. It has 3589 Branches spreads across 1946 cities & towns, 13977 ATMs, and 9 International Offices. It offers a wide range of Home Loan Schemes to different classes of customers to fulfil their dream of owning a home.

Axis Bank provides home loan for different needs and purposes such as for purchase, construction, and extension of dwelling unit, repairs/ renovation of home, for purchase of house which is under construction, for purchase of plot, etc. Axis Bank offers customised Home Loan solutions, best-in-class services and simplified loan process. It offers competitive, attractive and affordable home loan interest rates.


Axis Bank Home Loan Interest Rates Updated on 01 Aug 2021

ParticularsDetails
Interest Rate 6.7% onwards
Processing Fee0.50% of Loan Amount (Max. Rs 10,000)
Loan AmountCustomised
Loan TenureUp to 30 Years or upto the age of 70 years, whichever is earlier
Margin10% to 25% of the loan amount
Pre-closure ChargesNil prepayment charges under floating rate option
Partial prepayment chargesNil Partial prepayment charges under floating rate option
SecurityEquitable | Registered Mortgage of the Property in question

Why Axis Bank Home Loan?

  1. Axis Bank provides a range of Home Loan Schemes designed for different needs of customers
  2. Home loan interest is calculated on a daily reducing basis
  3. It has PAN India branch network provides easy access to the customers
  4. Pre Approved loan offers and preferential home loan interest rate for existing home loan borrowers
  5. It provides Flexible Repayment Options to the borrowers
  6. Quick & Hassle-free processing
  7. Easy and fast approval & disbursal of home loans
  8. Free & safe document Storage
  9. Special lower interest rate offer for women
  10. It provides rebate in Income Tax
  11. Has dedicated team of well-experienced employees
  12. Transparent process with no hidden charges
  13. Offers loan upto 90% of property value
  14. 24/7 helpline of Axis Bank offers timely assistance to the customers
  15. Axis Bank wins the Best Rewards Program for the 4th consecutive year at the Customer Loyalty Awards 2018
  16. Moreover, Axis Bank is the third largest Private Sector bank in India hence strong trust factor of people is involved

Purpose of Axis Bank Home Loan

  • Purchase a Plot for construction of a House
  • Purchase | construct house | flat
  • Home Extension
  • for renovation | repair | alteration | addition to house | flat
  • Take over from other Banks/ HFCs/ NBFCs/ FIs, etc.

Margin or Loan to Value Ratio (LTV) Ratio: For New Home Loan

Loan AmountMarginLTV Ratio
Up to Rs 30 lakhs10%90%
Up to Rs 30 lakhs & upto Rs. 75 lakhs20%80%
Above Rs. 75 lakhs25%75%

Eligibility Criteria of Axis Bank Home Loan

BasisSalaried CustomersNon Salaried Customers
AgeMinimum 21 years & Maximum 60 YearsMinimum 21 years & Maximum 65 Years
IncomeRegular source of income is neededRegular source of income is needed
Job/ Business Experience1 Year2 Years
Age of Co-applicantMinimum 18 yearsMinimum 18 years

Documents Required for Axis Bank Home Loan

Documents RequiredSalariedSelf Employed
Proof of identityValid Passport/ Voter's ID/ Valid Driving License with photograph / PAN Card / Aadhaar CardValid Passport/ Voter's ID/ Valid Driving License with photograph / PAN Card / Aadhaar Card
Proof of Income
  • Latest 3 months salary slip/ certificate for fixed salary/ Latest Form 16
  • Last 6 months bank statement/ Passbook of the salary account
  • IT returns for the last 2 years along with computation of income certified by CA
  • Last 6 months Bank statement for operative account both personal and business
Proof of ResidenceLatest Electricity Bill/ utility bill/ piped gas bill/ telephone bill (Not more than 2 months old)/ Passport/ Aadhaar card/ Voter ID/ Driving LicenseLatest Electricity Bill/ utility bill/ piped gas bill/ telephone bill (Not more than 2 months old)/ Passport/ Aadhaar card/ Voter ID/ Driving License

Fees & Charges on Axis Bank Home Loan

CategoryFee & Charges
Loan Processing Charges0.50% of loan amount Max. Rs.10,000 plus taxes
Bounced cheque/ECS or SI dishonours chargesRs. 500 on each such transaction
Stamping ChargesApplicable as per the respective State's Stamp Act
Prepayment ChargesNil
Penal Interest2% per month
Part Pre Payment ChargesNil
No Due CertificateNIL
Lawyer's feesTo be borne by the borrower on the basis of actual cost
Valuation feesTo be borne by the borrower on the basis of actual cost

Axis Bank Marginal Cost of Funds Based Lending Rate (MCLR) with effect from 17.04.2021

TenorRevised MCLR (In %)
Overnight7.20
1 Month7.20
3 Months7.30
6 Months7.35
1 Year7.40
2 Years7.50
3 Years7.55

Loan Amount of Axis Bank Home Loan

Loan offered to the borrower is completely customised as per the requirement and the eligibility criteria of the customer. The value of loan depends upon applicant's income, repaying capacity, age, assets and liabilities, credit score, tenure of the loan, cost of the proposed property, previous credit history.


Margin of Axis Bank Home Loan

Margin for Axis Bank Home loan ranges from 10% to 25% of the loan amount. It depends upon the scheme and loan amount availed by the borrower.


Repayment of Axis Bank Home Loan

The repayment of Axis Bank Home Loan can be done in Maximum 30 years or upto 70 years of the age of borrower, whichever is earlier.


Security of Axis Bank Home Loan

Being it a secured loan, the borrower is required to do Equitable | Registered Mortgage of the Property in question in favour of the bank. However, the bank may ask for other security also based on the case.


Axis Bank Home Loan Schemes

Sr NoSchemeBrief Description
1Axis Bank Home LoanRegular and most demanding scheme
2Axis Bank Fast Forward Home LoanGet 12 EMIs waived off upon regular EMI payment
3Axis Bank Shubh Aarambh Home LoanOffers 4 EMIs are waived every 4 years
4Axis Bank Asha Home LoanLoan up to Rs. 28 lakhs at monthly income as low as Rs. 8,000
5Axis Bank Pradhan Mantri Awas Yojana (PMAY)Subsidised home loan for eligible urban beneficiaries
6Axis Bank Top Up LoanBorrow amount over and above home loan amount
7Axis Bank Empower Home LoanGet 3 guaranteed rate reductions
8Axis Bank Super Saver Home LoanOffers home loan with an Overdraft facility
9Axis Bank Balance Transfer of Home LoanTransfer home loan from other institution to HDFC Bank

(1) Axis Bank Home Loan: This is a regular and most demanding home loan scheme that offers Housing Loan at attractive rates and ensure a house for all.

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, professional or self employed having regular income in the age group of 21 years to 60/65 years
  3. Processing Fee: Up to 1% of the Loan amount subject to minimum of Rs.10,000
  4. Minimum Loan Amount: Rs. 3 lakhs
  5. Maximum Loan Amount: Customised Up to Rs. 5 Crore
  6. Margin:10% to 25%
  7. Maximum Tenure: Max. 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 Rate (Floating):
    Customer TypeInterest Rate (p.a.)
    Salaried6.90% to 8.40%
    Non-salaried7.00% to 8.55%
  10. Interest Rate (Fixed):
    Customer TypeInterest Rate (p.a.)
    Salaried12%
    Non-salaried12%

(2) Axis Bank Fast Forward Home Loan: This is home loan scheme where you can get 12 EMIs waived off upon regular EMI payment.

Important Features:

  1. 6 months waived on completion of 10 years, and another 6 months on completion of 15 years from 1st disbursement
  2. Minimum loan tenure of 20 years
  3. Loan should be live for the minimum stipulated period of 120 months from 1st disbursement
  4. 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.
  5. Eligibility: Salaried, professional or self employed having regular income in the age group of 21 years to 60/65 years.
  6. Processing Fee: Up to 1% of the Loan amount subject to minimum of Rs.10,000
  7. Minimum Loan Amount: Rs. 30 lakhs
  8. Maximum Loan Amount: Rs. 5 crores
  9. Margin:10% to 25%
  10. Maximum Tenure: Max. 30 years
  11. 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.
  12. Interest Rate (Floating):
    Customer TypeInterest Rate (p.a.)
    Salaried6.90% to 8.40%
    Non-salaried7.00% to 8.55%
  13. Interest Rate (Fixed):
    Customer TypeInterest Rate (p.a.)
    Salaried12%
    Non-salaried12%

(3) Axis Bank Shubh Aarambh Home Loan: This scheme offers 4 EMIs are waived every 4 years. Hence total 12 EMIs are waived.

Important Features:

  1. Purpose: Home loans can be used to purchase an under construction / ready / resale house, self-construction, plot plus construction or home extension and improvement.
  2. Close the loan early without any prepayment .To avail waiver benefit the tenure should not fall below 4 years.
  3. Eligibility: Salaried, professional or self employed having regular income in the age group of 21 years to 60/65 years. Minimum loan tenure should be of 20 years at the time of disbursement. Maximum loan is upto Rs.30 Lakhs. Loan should be live for the minimum stipulated period of 48 months from the date of disbursement to avail waiver benefit.
  4. Processing Fee: Up to 1% of the Loan amount subject to minimum of Rs.10,000
  5. Minimum Loan Amount: Rs. 1 lakh
  6. Maximum Loan Amount: Rs. 30 lakhs
  7. Margin:10% to 25%
  8. Maximum Tenure: Max. 30 years
  9. 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.
  10. Interest Rate (Floating):
    Customer TypeInterest Rate (p.a.)
    Salaried6.90% to 8.40%
    Non-salaried7.00% to 8.55%
  11. Interest Rate (Fixed):
    Customer TypeInterest Rate (p.a.)
    Salaried12%
    Non-salaried12%

(4) Axis Bank Asha Home Loan: This scheme offers the facility of availing home loans with a low monthly income of Rs. 8,000 to Rs. 10,000. On loans upto Rs. 28,00,000, you can avail of a loan equal to 90% of the property value.

Important Features:

  1. Purpose: Home loans can be used to purchase an under construction / ready / resale house, self-construction, plot plus construction or home extension and improvement.
  2. Close the loan early without any prepayment .To avail waiver benefit the tenure should not fall below 4 years.
  3. Eligibility: Salaried, professional or self employed having regular income in the age group of 21 years to 60/65 years. Minimum loan tenure should be of 20 years at the time of disbursement. Maximum loan is upto Rs.30 Lakhs. Loan should be live for the minimum stipulated period of 48 months from the date of disbursement to avail waiver benefit.
  4. Processing Fee: Up to 1% of the Loan amount subject to minimum of Rs.10,000
  5. Minimum Loan Amount: Rs. 1 lakh
  6. Maximum Loan Amount: Loans upto Rs. 28 lakhs for locations with population above 10 lakhs and loans upto Rs. 20 lakhs for locations with population upto 10 lakhs.
  7. Margin:10% to 25%
  8. Maximum Tenure: Max. 30 years
  9. Nil penalty for pre-closure of home loan on floating interest rate Home Loans.
  10. 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.
  11. Interest Rate (Floating):
    Customer TypeInterest Rate (p.a.)
    Salaried10.05% to 11%
    Non-salaried10.30% to 11.50%

(5) Axis Bank Pradhan Mantri Awas Yojana (PMAY)- EWS/ LIG & MIG-I/ MIG-II: This scheme offers Housing Loan to Individuals from Economically Weaker Section (EWS), Low Income Group (LIG) and Middle Income Group (MIG) I and II category at attractive rates.

Important Features:

  1. Purpose: To extend home loan for purchase, new construction and addition of home, to existing dwelling units as incremental housing, for construction of house/ flat
  2. Eligibility: Individuals from Economically Weaker Section (EWS) & Low Income Group (LIG) category. Joint owners from the same family are also eligible. Beneficiary family should not own an all weather dwelling unit either in his/ her name or in the name of any member of his/ her family in any part of India. NRIs are also eligible in this.
    • EWS households - households having an annual income up to Rs.3,00,000 and house size with carpet area upto 30 square meter.
    • LIG households - households having an annual income above Rs.3,00,000 and up to Rs.6,00,000 and house size with carpet area upto 60 square meter.
    • MIG I households - households having an annual income above Rs. 6,00,000 and up to Rs.12,00,000 and house size with carpet area upto 120 square meter.
    • MIG II households - households having an annual income above Rs. 12,00,000 and up to Rs. 18,00,000 and house size with carpet area upto 150 square meter.
  3. Subsidy
    • EWS/ LIG Borrowers will get Credit Linked Subsidy at 6.50% for upto Rs. 6 lakhs for max. 20 years. Maximum subsidy amount will be Rs 2,67,280 only.
    • MIG-I Borrowers will get Credit Linked Subsidy at 4% upto 9 lakhs for max. 20 years. Maximum subsidy amount will be Rs 2,35,068 only.
    • MIG-II Borrowers will get Credit Linked Subsidy at 3% upto Rs 12 lakhs for max. 20 years. Maximum subsidy amount will be Rs 2,30,156 only.
  4. Table for detailed subsidy scheme
    ParticularsEWSLIGMIG-IMIG-II
    Interest Subsidy (% p.a.)6.5%6.5%4%3%
    Maximum loan tenure (in years)20202020
    Eligible Housing Loan Amount for Interest Subsidy (Rs.)6 lakhs6 lakhs9 lakhs12 lakhs
    Max. Dwelling Unit Carpet Area30 Sq. m.60 Sq. m.120 Sq. m.150 Sq. m.
    Maximum Subsidy Amount(Rs.)2,67,2802,67,2802,35,0682,30,156
  5. Margin: 10% to 25%
  6. Maximum Tenure: Max.30 years or up to borrower's age of 70 years, whichever is lower
  7. Security: Equitable| registered mortgage of the property
  8. Interest Rate (Floating):
    Customer TypeInterest Rate (p.a.)
    Salaried6.90% to 8.40%
    Non-salaried7.00% to 8.55%
  9. Interest Rate (Fixed):
    Customer TypeInterest Rate (p.a.)
    Salaried12%
    Non-salaried12%

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

First of all, you apply for home loan from Axis 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.


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

Important Features:

  1. Customer should already have a Axis Bank Home Loan Account. Existing Home Loan customers are eligible for a Top-Up Loan after six months' clear repayment.
  2. For an existing Home Loan borrower, clear repayment history is important. There should not be more than 1 EMI bounce in the last one year and the same should have been cleared before the next EMI date
  3. Loan Amount: Upto 30% of original sanction amount of original home loan, subject to maximum Rs. 50 Lakhs
  4. Loan Tenure: Same as outstanding home loan tenure
  5. It can be availed for any personal purpose and business purpose but purchase of another residential/ commercial premises is not permitted
  6. The interest rates are much lower than usual personal loan interest rates.
  7. Processing Charges:

    Upto 1% of the loan amount subject to minimum of Rs 10,000/-
  8. Interest Rate (Floating):
    Customer TypeInterest Rate (p.a.)
    Salaried6.90% to 8.40%
    Non-salaried7.00% to 8.55%
  9. Interest Rate (Fixed):
    Customer TypeInterest Rate (p.a.)
    Salaried12%
    Non-salaried12%

(7) Axis Bank Empower Home Loan: This scheme offers 3 assured rate reductions, on maintaining a good repayment track for 24, 36 and 60 months from the date of first disbursement to avail the 1st, 2nd and 3rd rate reduction respectively.

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: Resident self-employed customers (professionals and non-professionals) having regular income in the age group of 21 years to 60/65 years
  3. Processing Fee: Up to 1% of the Loan amount subject to minimum of Rs.10,000
  4. Minimum Loan Amount: Rs. 10 lakhs
  5. Maximum Loan Amount: Rs. 1.50 Crores
  6. Margin:10% to 25%
  7. Maximum Tenure: Max. 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 Rate (for salaried customers):
    Loan AmountInterest Rate (p.a.)
    Loan amount upto Rs 30 lakhs8.55%
    Loan amount above Rs 30 lakhs9.20%
  10. Interest Rate (for non-salaried customers):
    Loan AmountInterest Rate (p.a.)
    Loan amount upto Rs 30 lakhs8.65%
    Loan amount above Rs 30 lakhs9.40%

(8) Axis Bank Super Saver Home Loan: Super Saver home loan is a unique financing solution that helps you save on the total interest payable on your home loan with us. Any surplus funds at your disposal can now be effectively utilized to save on interest while still being able to use them whenever needed.

Important Features:

  1. After the loan is disbursed, any amount deposited in the Super Saver account by you shall reduce the principal outstanding and you will be charged interest on net principal outstanding i.e. loan amount outstanding minus any excess funds parked in the account.
  2. The excess funds parked can also be withdrawn on requirement.
  3. Unlike a standard home loan, Super Saver gives you an option to park additional funds which will reduce the interest obligation on your home loan to the extent of the funds parked, with the flexibility to withdraw them anytime. To help you make the most out of your Super Saver account you will be issued with an ATM card, cheque book, internet and phone banking facility.
  4. 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.
  5. Eligibility: Salaried, professional or self employed having regular income in the age group of 21 years to 60/65 years
  6. Processing Fee: Up to 1% of the Loan amount subject to minimum of Rs.10,000
  7. Minimum Loan Amount: Rs. 50 lakhs
  8. Maximum Loan Amount: Customised
  9. Margin:10% to 25%
  10. Maximum Tenure: Loan repayment tenure up to 20 years for Fully disbursed case and upto 22 years for partly disbursed case to make sure you enjoy the benefits for a longer term.
  11. 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.
  12. Interest Rate (for salaried customers):
    Loan AmountInterest Rate (p.a.)
    Loan amount upto Rs 30 lakhs8.55%
    Loan amount above Rs 30 lakhs9.20%
  13. Interest Rate (for non-salaried customers):
    Loan AmountInterest Rate (p.a.)
    Loan amount upto Rs 30 lakhs8.65%
    Loan amount above Rs 30 lakhs9.40%

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

Important Features:

  1. Customer should satisfy the eligibility criteria for availing Home Loan as per HDFC 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. 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.
  5. Interest Rate (for salaried customers):
    Loan AmountInterest Rate (p.a.)
    Loan amount upto Rs 30 lakhs8.55%
    Loan amount above Rs 30 lakhs9.20%
  6. Interest Rate (for non-salaried customers):
    Loan AmountInterest Rate (p.a.)
    Loan amount upto Rs 30 lakhs8.65%
    Loan amount above Rs 30 lakhs9.40%
  7. Interest Rate: Fixed Interest Rate: 12.00% p.a.

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 Axis 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 Axis Bank Home Loan

You can repay Axis 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 Axis 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 Axis Bank towards loan repayment instalment.

(2) Standing Instruction (SI): If you maintain your account with Axis Bank, then you can use this method. Under this method, you will have to issue a Standing Instruction to Axis Bank to debit your EMI amount on a due date every month from your Axis Bank account and credit to Axis 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 Axis Bank for a certain period of time, which are deposited by the Axis Bank on the due date. This alternative is cumbersome and time-consuming and involve a manual procedure of visiting the Axis 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 Axis Bank Home Loan, will EMI change?

One can pre-pay Axis 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 Axis 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 Axis Bank Home Loan Aug 2021