Home loan cost and eligibility: fees, stamp duty, insurance and FOIR
Last verified: . Author: Rajesh Mehta. Reviewed by: Priya Sharma.
Short answer: Beyond interest, a home loan costs a down payment of at least 10% to 25% of the property value, a processing fee, legal and valuation fees, stamp duty and registration. Your loan size depends on FOIR: at 50% FOIR, a ₹50,000 monthly income supports about ₹31.6 lakh over 20 years at 7.25%.
MoneyKarma (MyMoneyKarma Infomatics India Private Limited) is a home loan comparison and distribution platform, not a lender; the bank or housing finance company you choose sanctions the loan and sets your final rate.
What does a home loan cost beyond the interest rate?
The main one-time costs are:
- Down payment. Banks may lend up to 90% of the property value for loans up to ₹30 lakh, 80% for ₹30 lakh to ₹75 lakh, and 75% above ₹75 lakh, under RBI's housing finance rules for scheduled commercial banks (RBI Master Circular on Housing Finance, 1 Apr 2025). So you pay at least 10%, 20% or 25% yourself.
- Processing fee (table below), plus 18% GST.
- Legal and valuation fees. HDFC Bank, for example, charges external advocate and valuer fees at actuals (HDFC Bank).
- Stamp duty and registration on the property purchase, and stamp duty on the mortgage. These are state levies paid by the borrower; HDFC Bank's terms say statutory charges such as stamp duty, MOD/MOE and CERSAI are borne by the customer (HDFC Bank). Rates differ by state, so check the current stamp duty and registration charges on your state's registration department (IGR) website before you budget.
- Insurance, if you choose it or the lender requires it (see below).
What are home loan processing fees at major lenders?
| Lender | Processing fee | Notes | Source | Verified on |
|---|---|---|---|---|
| HDFC Bank | Up to 0.50% of the loan amount or ₹3,000, whichever is higher, plus taxes | Non-refundable; minimum retention 50% of fee or ₹3,000 | homeloans.hdfc.bank.in | 9 Oct 2026 |
| ICICI Bank | 0.5% of the loan amount plus taxes | Special fee for instant home loan offers | icici.bank.in | 9 Oct 2026 |
| Axis Bank | Up to 1% of the loan amount or ₹10,000, whichever is higher, plus GST | ₹5,000 plus GST collected at application; ASHA loans 1% to 2% | axis.bank.in | 9 Oct 2026 |
| Bank of Baroda | 0.50% up to ₹50 lakh (min ₹8,500, max ₹15,000); 0.25% above ₹50 lakh (min ₹8,500, max ₹25,000). Takeover: flat ₹8,500 | Excluding GST. The bank's page prints "50%" and "25%"; only 0.50% and 0.25% fit its minimum and maximum amounts | bankofbaroda.bank.in | 23 Oct 2026 |
| Tata Capital Housing Finance | Up to 3% of the loan amount plus GST | tatacapital.com | 9 Oct 2026 | |
| State Bank of India | 0.35% of the loan amount plus GST: min ₹5,000; max ₹15,000 (salaried) or ₹18,000 (non-salaried) | Same for top-up loans; nil for Privilege and Shaurya home loans | homeloans.sbi.bank.in (PDF) | 23 Oct 2026 |
GST at 18% applies to fees and charges. Tata Capital's example: a 1% fee on ₹1 crore is ₹1 lakh, plus ₹18,000 GST (Tata Capital).
Is home loan insurance mandatory?
Lenders treat it differently, so read the sanction letter:
- Credit (loan) insurance: PNB Housing Finance states that taking its insurance products is purely voluntary (PNB Housing Finance). Bank of Baroda adds a 0.05% risk premium to the rate if you do not take credit insurance cover (Bank of Baroda). Union Bank gives an extra 0.05% concession if you assign a credit, term or life policy to the bank (Union Bank card).
- Property insurance: HDFC Bank's charges page says the customer must pay premiums directly to the insurer and keep the policy alive for the life of the loan (HDFC Bank).
If you buy cover, compare the premium with the rate concession you receive.
How much home loan can I get on my salary?
Lenders size your loan by how much EMI you can afford. They use FOIR (fixed obligations to income ratio):
FOIR = (existing EMIs + new home loan EMI) / net monthly income
Each lender sets its own FOIR limit by income level and profile, and few publish it. Bank of Baroda caps total deductions, including the new EMI, at 40% to 75% of net monthly income for salaried borrowers, depending on income (Bank of Baroda). SBI says its EMI-to-income ratio ranges from 20% to 70% by income slab (SBI FAQ). The table below assumes 50% FOIR and no other EMIs. It is an illustration, not an offer.
| Net monthly income | EMI at 50% FOIR (assumed) | Loan at 7.25%, 20 years | Loan at 7.25%, 30 years | Loan at 8.75%, 20 years |
|---|---|---|---|---|
| ₹25,000 | ₹12,500 | ₹15.8 lakh | ₹18.3 lakh | ₹14.1 lakh |
| ₹50,000 | ₹25,000 | ₹31.6 lakh | ₹36.6 lakh | ₹28.3 lakh |
| ₹75,000 | ₹37,500 | ₹47.4 lakh | ₹55.0 lakh | ₹42.4 lakh |
| ₹1,00,000 | ₹50,000 | ₹63.3 lakh | ₹73.3 lakh | ₹56.6 lakh |
| ₹2,00,000 | ₹1,00,000 | ₹1.27 crore | ₹1.47 crore | ₹1.13 crore |
Our calculation: loan = EMI × ((1 + r)^n - 1) / (r × (1 + r)^n). 7.25% is SBI's published starting rate and 8.75% is ICICI Bank's lowest standard rate, both on 9 Oct 2026. Each ₹1 lakh of loan costs ₹790 a month at 7.25% over 20 years, ₹682 over 30 years, and ₹884 at 8.75% over 20 years.
What changes the answer:
- Existing EMIs reduce the room for a new EMI one-for-one.
- A co-applicant's income can be added. PNB Housing Finance, for example, allows co-borrower income to be clubbed (PNB Housing Finance).
- Tenure is limited by your age at maturity.
- LTV caps the loan at 75% to 90% of the property value, whatever your income.
What else decides home loan eligibility?
- Credit score: rate cards are priced by score. Union Bank, for example, charges 7.15% at CIBIL 825 and above and 9.35% at 600 to 649 (Union Bank card).
- Employment and income stability: HDFC Bank asks salaried applicants for the last 3 months' salary slips, 6 months' bank statements and the latest Form 16 and income tax returns (HDFC Bank).
- Property: clear title, approved plans and no encumbrances. HDFC Bank lists title deeds, the previous chain of documents and approved plans among required documents (HDFC Bank).
What tax benefits are there on a home loan?
From 1 April 2026 the Income-tax Act, 2025 replaced the Income-tax Act, 1961, so the familiar deductions have new section numbers (Income Tax Department). Under the old tax regime, interest on a loan for a self-occupied house can be deducted up to ₹2,00,000 a year under section 22 (formerly section 24(b)) (Income-tax Act, 2025), and principal repayment counts towards the ₹1,50,000 limit under section 123 read with Schedule XV (formerly section 80C) (Income Tax Department FAQ). Under the new tax regime (section 202, formerly section 115BAC), neither deduction is allowed (Income Tax Department FAQ).
How can MoneyKarma help me check eligibility?
MoneyKarma (MyMoneyKarma Infomatics India Private Limited) is a home loan comparison and distribution platform, not a lender; the bank or housing finance company you choose sanctions the loan and sets your final rate. MoneyKarma can estimate your eligibility across partner lenders and show each lender's fees. The lender makes the final credit decision.