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Indian Overseas Bank Home Loan Interest Rates

Since 1937, Indian Overseas Bank (IOB) has been providing remarkable banking solutions to their customers. It was one of the first banks in India to start operations overseas.

IOB offers Subha Gruha home loan to their customers to fulfil their dream of owning a home.

IOB Home Loan Interest Rates

Loan SchemeInterest rate
Subha Gruha
Up to Rs.30 lakhs8.70%
Above Rs.30 lakhs - Rs.75 lakhs8.80%
Above Rs.75 lakhs8.95%
Home Improvement loan
Up to Rs. 2 lakhs8.90%
Above Rs. 2 lakhs9.05%

Factors that affect the interest rates on Indian Overseas Bank Home Loans

The home loan from Indian Overseas Bank must be liquidated before the borrower attains the age of 70 years. The loan carries an interest that could vary from borrower to borrower. If you are keen on getting the lowest interest rate, you must very well be aware of the factors that impact the interest on home loans.

Loan Amount :

Indian Overseas Bank provides home loans for up to 90% value of the property. The interest rate would increase with a higher loan amount. A higher loan amount increases the risk for the lender and hence they charge a higher interest rate. Women applicants are given a concession on the interest rate. Hence, higher the down payment you are ready to make, the loan amount is lower and hence a lower interest rate.

Type of Interest :

Indian Overseas Bank provides the option of floating rates and fixed rates. Floating rate is bound to change as per market conditions. A fixed rate doesn’t change throughout the loan tenure. Banks offers additional benefits and offers for floating rates.

Your Credit Score Matters :

Any credit score 750 and above is considered a good credit score. Your creditworthiness is evaluated based on your credit score. With the good credit score, the chances are higher to obtain a lower interest on home loans.

Relationship with the lender :

If you have a savings account with the lender or have a long-standing relationship in terms of a credit card or any other loan, chances are higher you may lower interest rate based on your relationshp.

Tenure :

Just as the loan amount, the tenure also determines the rate of interest on the home loan. The lower tenure will get you low interest rate home loans than a longer repayment period.

IOB Home Loan Features

Indian Overseas Bank offers higher loan amount with competitive interest rates. Some of the features of an IOB Subha Gruha home loan are:

Eligibility : IOB home loans are available to a wide range of customer base, viz; salaried individuals, self-employed individuals, group of individuals and members of co-operative societies.

Individual applicants should not be more than 55 years of age. However, in case of legal heir applying jointly, their age may be taken into consideration. It should be noted that the loan must be liquidated before the borrower attains the age of 70.

Salaried individuals should have been in employment for a minimum of 2 years. Self-employed business owners and professionals should have a minimum 3 years of business continuity.

Purpose: IOB offers home loans for the following purposes

To buy, build or renovate a flat or house

For repairs, renovation, upgradation or modification of an existing flat or house

Top-up home loans for existing home loan borrowers with a satisfactory repayment history of at least 1 year

NRI Home Loan : Home loans offered to NRIs with a valid Indian passport or a Person of Indian Origin holding other country passport, to buy, build or renovate a flat or house.

SUBHAGRUHA Housing Loan CC : A housing loan facility offered in the form of Cash Credit, which allows the customers to park any surplus money in this account, thereby reducing the interest burden.

SUBHAGRUHA GEN NEXT Housing Loan : An instant home loan, specially designed for salaried individuals, providing 20% higher loan amount than other loan products.

Quantum of Loan : IOB offers home loans from 75% up to 90% of the purchase cost of the property. The final loan amount depends on the cost of the property and a few other factors like your salary, employment status, age, the down payment you are willing to make, etc.

Borrowers can obtain 30% of the cost for purchase of a plot.

Repayment tenure : The loan can be repaid in EMIs for a maximum period of 30 years. IOB gives a maximum holiday period of 18 months from the date of loan disbursement or date of construction completion, whichever is earlier. In case of purchase of a constructed house, the holiday period is a maximum of 3 months.

Security : Equitable mortgage of the purchased property is to be enabled. The property should be in the name of the loan applicant. A comprehensive insurance covering the property value is required. Any additional security in the form of NSC, LIC, Units of UTI will also be accepted.

Processing charges : IOB charges a processing fee of 0.50% of the loan amount or Rs.20,000/-, whichever is higher, towards home loan processing. For top-up loans, 0.75% or Rs.25,000/-, whichever is higher, is charged.

Documentation :

  • Duly filled in home loan application form
  • Salary documents for salaried individuals
  • Proof of income documents for self-employed professionals and business owners
  • Proof of membership for co-operative societies
  • Property documents, sale deed, proof of construction, etc.
  • Legal opinion on the property by a bank approved engineer/lawyer
  • Any other document as required by the bank at the time of loan application

FAQs: Indian Overseas Bank Home Loan Interest Rates

1. What is the lowest rate of interest on home loans offered by IOB?

The current lowest interest rate is offered for loans of up to Rs.30 lakhs at 8.70%. The interest rate is based on the MCLR rate and is bound to change according to the market conditions. The rate of interest varies for individual based on the income, employment type, age, cost of the property, etc. Once you have submitted the necessary documents, the bank will let you know the loan amount and the rate of interest you are eligible for.

2. Can I pre-pay my loan?

Yes, you can pre-pay your loan. IOB does not charge any pre-payment penalty charges.

3. What is the maximum amount I can avail as loan?

IOB does not have a limit on the maximum amount you can avail as loan. However, the margin is fixed at 75% - 90% of the purchase cost. The final loan amount eligibility is fixed based on your repayment capacity.

4. What are the processing charges for IOB home loans?

IOB charges a processing fee of 0.50% of the loan amount or Rs.20000/-, whichever is higher, towards home loan processing. For top-up loans, 0.75% or Rs.25000/-, whichever is higher, is charged.

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