Home loan emi: There is news of relief for home loan customers. In June 2025, many banks have reduced their home loan interest rates after the Reserve Bank of India (RBI) cut the repo rate by 50 basis points (BPS). Due to this, customers taking home loans are getting loans at very cheap rates. Let us know which is currently giving home loans at the lowest interest rate.
RBI cut effect
Repo rate reduction makes borrowings cheaper for banks, which also gives loans to consumers at low interest. Since about 60% of home loans are linked to Linked lending Rate (RLR), changes in repo rate have a direct impact on EMI and interest rates. This makes it easier for banks to make loans cheaper.
Bank of Baroda is reducing the rate
Bank of Baroda has further cut its home loan rate by 5 BPS, which has reduced to 7.45%. The bank also reduced its rates from 8% to 7.50% in June. The bank says that this deduction has been done after softening in the monetary policy of RBI.
These 10 banks are giving the cheapest home loans
| Bank |
Interest rate (from per year) |
| Union bank of india | 7.35% |
| Bank of Maharashtra | 7.35% |
| Central bank of india | 7.35% |
|
Indian Overseas Bank |
7.35% |
| Bank of india | 7.35% |
| Bank of Baroda | 7.45% |
| State bank of india | 7.50% |
| Punjab national bank | 7.50% |
| Uco bank | 7.50% |
| Saraswat Bank | 7.50% |
data: By 5 July 2025
Note: These are the initial interest rates for the home loan of these banks. However, the actual rate of loan depends on your credit profile, income, loan amount and duration. Customers with more than 800 credit scores usually get the lowest rate.
Will home loan be cheaper even further?
According to a report by SBI Research, due to low inflation and slow growth in the country it is ‘Goldalox period’ i.e. the best time to reduce interest rates. The report also states that if inflation continues to decrease, there may be a total cut of 1% by March 2026. This means that the loan can be more cheaper. Experts suggest that you must compare all banks before taking a loan, so that you can get the best and cheaper option.
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