With the financial system enjoying a healthy liquidity position, a growing number of commercial banks are considering housing loan as a way to expand their lending portfolio. Some of the commercial banks have already rolled out different schemes to sell their housing loan products, while others are in the process of following suit. 

Taking advantage of the festive season, banks have lowered interest rate in the range of 10-12 percent. Considered as one of the safest products, home loan is extended to individuals based on their regular incomes.

Laxmi Bank has recently introduced a 25-year home loan plan, under which new home owners/buyers can repay their loans over 300 equal monthly installments (EMI).

Likewise, home loan accounts for the significant portion of Everest Bank’s lending portfolio. Although the banks have not rolled out specific home loan product recently, it has a special interest in selling retail home loan products where individual loan account for less than Rs 10 million, according to Everest Bank CEO P K Mohapatra.

The banks are rolling out new home loan product at reduced interest rate. While Laxmi Bank has is now offering 25-year-long home loans at 10 percent annual interest, Everest is selling its home loan at interest rates ranging from 10.5 to 12 percent.

Himalayan Bank Limited (HBL) has fixed the interest rate of its home loan at 10.58 percent for three years after which there will be a floating rate for the next 12 year. CEO of HBL Ashok Rana said that the fixed interest rate was crucial in winning consumers’ confidence and allay their fears of fluctuation in interest rate in the future. “Our product is getting amazing response from the customers,” said Rana.