Lowest home loan rates in June 2026 after RBI’s Repo Rate announcement: Banks and HFCs compared

The Reserve Bank of India (RBI) in its June monetary policy review kept the repo (key policy) rate unchanged at 5.25% even as risk of higher inflation has risen in the wake of lingering West Asia crisis.

“Although risks of higher inflation have amplified, the MPC felt it would be prudent to wait for greater clarity to emerge. Accordingly, the MPC voted to keep the policy rate unchanged. At the same time, the MPC will continue to remain data-dependent and closely monitor the developments, including supply side pressures getting embedded in the general price level and inflation expectations. The MPC also decided to retain the neutral stance,” said the monetary policy statement.

Now, as existing and potential borrowers closely track the RBI monetary policy review for likely cues on interest rates going forward, here we take you through the cheapest home loan rates on offer as of June 5, 2026 post the RBI’s much-watched action.

Most home loans in India (typically new floating rate loans) are linked to the external benchmark which is mostly the RBI’s repo rate. In addition, lenders charge a spread based on their costs, profit margin as well as the borrower’s risk profile.

Now as the interest rate is unlikely to edge lower in the near future in view of the steady repo rate maintained at 5.25%, here is the table showing the lowest starting home loan rates offered by banks and housing finance companies after the RBI repo rate announcement on June 5, 2026.

Source: From respective bank and NBFC websites as on June 5, 2026

So, of the many financial entities offering home loans in India, including commercial banks and NBFCs, many institutions such as Bank of India, LIC Housing Finance and Canara Bank offer home loans at the lowest starting rate of 7.1-7.15% per annum.

Points to check to avail home loan at the lowest possible rate

For getting the lowest possible rate on home loans, you can adhere to some of the criteria, including keeping the credit score well above the 750 mark. A higher credit score reduces the home loan interest rate by 0.5-1%. Also, can try and get a loan from a public lending institution as against the private for better and lower rates.

Co-applicant with a better credit profile can also be added to secure a decent rate. Also, those in a stable employment or professionals are able to get a lower rate of interest. In addition, you can negotiate on the interest rate. Banks usually offer a lower rate to creditworthy borrowers.

Besides, joint home loan with one of the co-borrower as a woman also helps to secure a lower rate. Women borrowers get up to 0.25% lower rate of interest. Furthermore, in contrast to the fixed home loan rates that are offered at a higher rate of interest, opting a floating rate of interest makes more sense in a falling interest rate regime. Also, you can go for a balance transfer in case of existing loans for getting a lower rate of interest.