Home Loan Interest Rates - December 2025

The Interest rate on a Home Loan is the percentage charged as interest by the lender on the total amount an individual borrows to buy or refinance a residential property.

The current Home Loan Interest rates offered by ICICI Bank can be checked in the table given above.

The Interest rate of home loan depends on multiple factors such as bureau score, customer segment, customer profile etc. Customers can also compare Interest rates offered by different banks and can transfer their existing loan to a favourable lender, if applicable to save on your EMIs.

Yes. Factors like credit score play a crucial role in deciding the Interest rate that an individual pays on their Home Loan.

All applicants can easily find out the EMI amount by using our Home Loan EMI Calculator. To use the calculator, you must provide the Interest rate, tenure and loan amount and you will be shown the interest payable and EMI amount instantly.

The choice of Interest rate can greatly affect your home loan EMIs. Here are the two main types:

1. Floating Interest Rate:

This rate varies with market conditions, offering potential savings but also carries the risk of the rate being increased. This is suitable for customers who can handle uncertainty.

2. Fixed Interest Rate:

A fixed Interest rates provides stability, ensuring consistent EMIs throughout the loan term, making budgeting easier.

Interest payments are calculated using the below methods:

1. Flat Interest Rate:

Calculates interest on the full loan amount for the entire loan term, leading to higher total interest costs.

2. Reducing Balance Method:

Interest is calculated on the remaining principal balance. As you repay, the interest may increase or decrease, affecting the overall loan cost.

Below are some important aspects that are considered when deciding the Home Loan Interest rate:

• Credit Score: All lenders consider the loan applicant's credit score. People with a higher credit score are more likely to be eligible for a higher Home Loan

• LTV (Loan to Value) Ratio: This is the proportion of the loan amount that goes towards the home's appraised value

• Economic Conditions: Broader economic aspects such as central bank policies, market trends and inflation can impact Interest rates

• Borrower’s Debt - To - Income Ratio: All lenders check the borrower’s debt and income levels to determine their repayment capacity and accordingly, the Interest rate.

• Make additional repayments: When you make extra repayments towards the principal amount, you reduce the outstanding loan amount and consequently, the interest to be paid

• Choose a shorter loan duration: Opting for a loan with a shorter duration (tenure) will result in higher monthly payments but lower interest payout

• Negotiate with the lender: If applicable, you should negotiate with the lender to obtain a lower Interest rate. 

To calculate the overall interest payout for the Home Loan, use the online Home Loan Calculator offered by ICICI Bank.  Provide the tenure, Interest rate and loan amount to check the interest you must pay during the loan term.