25 Lakh Home Loan EMI Interest Rate 2022

Calculate 25 Lakh Home Loan EMI Interest Rate 2022

If you are planning to borrow a sum of Rs.25 Lakhs towards the purchase, construction or repair of a property, the good news is that there are several banks that you can choose from. However, before you make that financial commitment, you should know how much 25 lakh home loan EMI you can expect each month. 

Click here to calculate Rs. 25 Lakhs Home Loan EMI

Here are all the details required for you to choose a bank that is best suited for you to finance a new property. 

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25 Lakh Home Loan EMI Details

One factor that influences the EMI payable towards the loan is the tenure of the loan. 25 Lakh home loan EMI for 10 years varies significantly from a home loan that has a tenure of 30 years. 

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Before we delve into the details of the exact EMI to expect, let us understand how 25 lakh home loan EMI is calculated, to begin with. 

An EMI is an Equated Monthly Installment. This is the repayment that you have to make towards your loan each month. Every bank uses a standard formula to calculate this EMI, which is E = [P x R x (1+R)^N]/[(1+R)^N-1]. Here P is the loan amount, R is the rate of interest and N is the tenure of the loan. 

You can also calculate the EMI using an excel sheet with the PMT formula. Just click on the ‘=’ symbol and enter the formula PMT (rate of interest, period and loan amount). Then click on the enter button. Then, you can add the three variables: 

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• The monthly interest- If your interest rate is 12% p.a, add the monthly interest rate as 1%.
• Loan tenure- This value should be typed in months. So, if it is 15 years, you will enter 180 months
• Loan Amount- The total amount availed as a loan.

You can skip these complicated calculations entirely and make use of a 25 Lakh home loan EMI calculator. This is a financial tool that is available on all banking websites and finance-related websites. All you have to do is enter the parameters, namely the tenure, rate of interest and loan amount. 

The calculator will apply the EMI formula and give you an accurate result. You can calculate 25 lakh EMI for 10 years or any other tenure in just a few seconds. 

Calculating your EMI in advance will help you understand if a particular loan plan is affordable for you. You can plan your monthly budget accordingly and change parameters like the loan amount and tenure to reduce the EMI as per your convenience and affordability.

Additional Info: LIC Home Loan

25 Lakh Home Loan EMI for 30 Years

Let us calculate 25 Lakhs home loan EMI for 30 years at an interest rate of 7.05% which is the most common offering by most banks: 

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25 Lakh Home Loan EMI for 25 Years

Let us reduce the tenure by 5 years to see how the EMI is affected by the tenure.

25 Lakh Home Loan EMI for 20 Years

You can use a 25 lakh home loan EMI calculator to check the exact interest payable towards the loan. 

25 Lakh Home Loan Interest Rates

When you are calculating the EMI for an Rs.25 Lakh loan, the interest rate is the deciding factor when you are choosing the lender. Each lender offers different interest rates depending upon their internal policies. 

Majorly, there are two kinds of Home Loan interest rates that are applicable when calculating a 25 lakh home loan EMI: 

• Fixed interest rates: These interest rates remain the same from the beginning to the end of the tenure as they are not affected by the market lending rates. 
• Floating interest rates: Floating interest rates are linked to market lending rates. So, with any increase or decrease in the market rate, the rate of interest applicable also changes. 

Irrespective of the type of interest rate that you opt for, there are many factors that determine the final rate of interest that is offered to the customer: 

• The CIBIL score: This is the most important factor that determines the 25 Lakh home loan EMI. The CIBIL Score, also known as the credit score, shows the financial health of any individual. If they have made regular repayments towards any existing credit and have good financial health, then the CIBIL score is high. In this case, the individual is considered a good candidate for a home loan. Therefore, he or she is offered a lower interest rate. 
• The Loan to Value ratio: The loan to value ratio is calculated according to the market value of the property. If the property is in a prime location and has a good resale value, the margin to be paid by the applicant reduces. Since the property is taken in as security against the loan, a higher loan to value ratio often attracts a lower interest rate. 
• The income: When the repayment capacity of the individual is higher, the interest rate is reduced. So when the income of the individual is higher, he or she is eligible for a lower interest rate.  If you wish to apply for a home loan, it is a good idea to show multiple income sources to bring down your EMI payable. You can also apply for a joint loan where the income of the co-applicant is taken into consideration. 
• Age of the customer: Home loans are long term loans. Therefore, the age of the customer is a very important criterion. Younger candidates are most preferred as they can get the complete home loan tenure, allowing them to enjoy lower 25 lakhs home loan EMI for 10 years or more. So, they are also offered a lower rate of interest. 

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Popular Banks providing 25 Lakh Home Loan

You can use the 25 lakhs home loan EMI calculator for various banks to compare the final amount payable. 

Here is a list of popular banks that provide up to 25 lakhs home loans and the interest rate offered by them: 

Eligibility Criteria

The Home Loan eligibility criteria to avail of a loan for Rs.25 Lakhs are as follows: 

• Should be a citizen of India
• The applicant should be at least 18 years of age.
• The maximum age varies according to the bank, with a cap at 65 years in most cases.
• He or she should have a stable source of income in the form of employment or a business.
• They should meet the minimum income requirement according to the bank chosen.

Documents Required

The Documents Required for Home Loan are as follows: 

• KYC documents like PAN Card or Adhaar Card
• Salary Slips for the last 3 months or Form 16 in case of salaried individuals.
• Profit and loss statements or tax return documents for self-employed individuals.
• Bank account statements for the last 6 months.

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FAQs

✅Should I increase loan tenure to reduce monthly EMI?

You can opt to increase the tenure of your loan to bring down the EMI. However, you must note that you will end up paying a higher amount towards the interest. So, it is advisable to negotiate on the interest rate if possible and ensure the lowest possible tenure. 

✅How to use an EMI calculator? 

You will have to enter the rate of interest, tenure and loan amount or use a slider to set these parameters. Then click on ‘Calculate’ to get the exact details of your loan. 

✅Do I have to pay a margin for a 25 lakh home loan? 

In most cases, the borrower has to pay a margin of at least 10%. This depends upon the loan to value ratio offered by the bank that you have availed your loan from. 

✅Are there any tax benefits with home loans? 

Any repayment made towards a home loan is eligible for tax deductions according to the Income-tax Act of 1961. You can get deductions on both the interest and the principal amount based on the type of property and the value of the property. 

✅What is the CIBIL score required for an Rs.25 lakh home loan? 

Most banks ask for a CIBIL score of at least 650-700 for an individual to be eligible for a home loan of Rs.25 lakhs. 

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