Quick-set current bank rates below. SBI: 8.50% · HDFC: 8.75% · ICICI: 8.75% · Axis: 8.75% · LIC HFL: 8.65% — rates as of 2026, verify with bank.
Home Loan EMI — Key Questions Answered
How is home loan EMI calculated?+
Home Loan EMI = [P × R × (1+R)^N] / [(1+R)^N - 1], where P is loan amount, R is monthly interest rate (annual rate ÷ 12), and N is total months. For a ₹50 lakh loan at 8.5% for 20 years: R = 8.5/12/100 = 0.00708, N = 240. EMI = ₹43,391/month. Total payment = ₹1.04 Crore, of which ₹54 lakhs is interest — more than the principal itself.
What home loan amount can I get on my salary?+
Banks typically allow EMI up to 40–50% of your net monthly income (FOIR — Fixed Obligation to Income Ratio). At 8.5% for 20 years: Monthly income ₹50,000 → Eligible loan ≈ ₹28–30 lakhs. Monthly income ₹1 lakh → Eligible loan ≈ ₹57–60 lakhs. Monthly income ₹2 lakhs → Eligible loan ≈ ₹1.15–1.2 Crore. These are guidelines; actual eligibility depends on credit score, existing EMIs, and the bank's internal policy.
Should I choose 20-year or 30-year home loan tenure?+
20 vs 30-year comparison for ₹50 lakh at 8.5%: 20-year EMI: ₹43,391 | Total interest: ₹54.1L. 30-year EMI: ₹38,446 | Total interest: ₹88.4L. The 20-year option saves ₹34.3 lakhs in interest but costs ₹4,945 more per month. If you can afford the higher EMI, 20 years is far better financially. Prefer shorter tenure and make part-prepayments when possible. A 30-year loan only makes sense if cash flow is very tight or if you can invest the EMI difference at returns higher than your loan rate.
How much does 0.25% rate reduction save on home loan?+
On a ₹50 lakh home loan for 20 years: 8.75% → EMI ₹44,493, Total interest ₹56.8L. 8.50% → EMI ₹43,391, Total interest ₹54.1L. Saving from 0.25% rate cut: ₹1,102/month, ₹2.7 lakhs total. On a ₹1 Crore loan, this doubles to ₹5.4 lakhs saved. This is why negotiating your rate and comparing banks matters enormously. Even after loan disbursement, you can do a balance transfer to a lower-rate lender — often saving lakhs on large loans.
What are the tax benefits on home loan?+
Home loan offers two tax deductions in the Old Tax Regime: (1) Section 24(b): Deduction on interest paid — up to ₹2 lakh per year for self-occupied property. No limit for let-out property. (2) Section 80C: Deduction on principal repaid — up to ₹1.5 lakh per year (shared with other 80C investments). For a ₹50L loan at 8.5%, annual interest in initial years is ₹4–5 lakhs, but only ₹2L is deductible. Note: These deductions are not available under the New Tax Regime. Calculate which regime saves more tax before choosing.