Best banks to get your home loan in 2021

Best banks to get your home loan in 2021

Home loans not only help people to become property owners at a comparatively young age, it also helps one to have ownership over secured assets, which is especially useful in an emergency situation like the Coronavirus pandemic. However, how cost effective your home loan would be, depends on the bank you choose to get the home loan from. More importantly, the bank offering the lowest interest rate may not be the best bank for you, if you factor in the various other charges that the lenders impose on providing the loan.

To put it simply, it may be quite confusing for a home buyer to select the best financial institution to borrow the home loan from, while evaluating not only the lowest interest rates but also the overall effectiveness of the bargain. This is why selecting the best bank for home loan is highly subjective and the borrower needs to keep in mind various factors.

To make things easier for borrowers, we list here the best banks to get a home loan from in 2021.

Note: As the interest charges will always be the single-biggest influencer in driving the borrower’s decision, we have listed the banks that offer you the most affordable deals, currently. However, while making the list, we have also determined the banks’ loan affordability, by factoring in the fringe charges. Also note that the rates mentioned in this article are with regard to the floating rate of interest, linked with the RBI’s repo rate and not the previous marginal cost of funds-based lending rate (MCLR) regime, or base rate or prime lending rate regimes.

Kotak Mahindra Bank

A fast-growing private lender, the Uday Kotak-headed banks has branched over 100 cities in India. At present, Kotak Mahindra if offering the best rate of interest on home loans in the market

State Bank of India (SBI)
The largest mortgage lender in India, government-run State Bank of India (SBI) has assisted over 30 lakh families in their home purchases till date. Established in 1955, the lender also has over 24,000 branches in India and abroad. Note that SBI is the biggest player in the home loan segment, with a book size of Rs 5.05 trillion. On a year-on-year basis, its home loan book has grown by 11% cent in Q1, FY22.

Established in 1977, HDFC has helped over 80 lakh people purchase their homes till date. It is important to note here that HDFC, a Mumbai-headquartered housing finance company (HFC), should not be confused with HDFC Bank, even though the two entities are part of the same HDFC Group.


ICICI Bank, the country’s second-largest private lender by market-capitalisation, was originally promoted in 1994 by ICICI Limited and was its wholly-owned subsidiary. ICICI Bank currently has a network of 5,288 branches across India.

Bank of Baroda

The Vadodara-headquartered Bank of Baroda became the third-largest bank in India after SBI, after its merger with Dena Bank and Vijaya Bank in April 2019. Founded by the maharaja of Baroda in 1908, the bank, along with 13 other major commercial banks of India, was nationalised on July 19, 1969, by the government and currently operates more than 10,000 branches in India and abroad.

Punjab National Bank

The second-largest public sector bank in India, Punjab National Bank (PNB) is also currently offering home loan interest rates at affordable rates. The New Delhi-headquartered state-owned bank was founded in 1894 and has over 80 million customers and 6,937 branches across 764 cities.

Canara Bank

Founded in July 1906 at Mangalore, Karnataka, Canara Bank was nationalised in 1969. This bank which is over a century old, has its headquarters in Bengaluru and operates over 10,391 branches across India. Last year, Canara Bank became the fourth-largest state-owned bank by assets after its merger with Syndicate Bank assuming a business size of over Rs 16 trillion.

Union Bank

This Mumbai-headquartered public lender is currently offering the cheapest home loans in the market. A limited company, the bank has a network of over 9,500 domestic branches.


Those who find it more comfortable to stick with a bank rather than a HFC could apply for a home loan at HDFC Bank, the baking subsidiary of the HFC, HDFC. Incorporated in 1994, the bank has a nationwide network of 5,430 branches.



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