SBI vs LIC Housing Finance: Which Home Loan is Better?


The interest rates offered by lenders are one of the key factors in any loan. SBI offers an interest rate somewhere between 6.8% to 7.4% on home loans and LIC charges ranging from 6.9% to 7.8%. You can use the CRED’s Home Loan EMI Calculator available online to know the EMI amount. These lenders charge no processing fee. The maximum loan amount you can get from SBI is Rs. 7 crores, and LIC Housing Finance can lend a maximum of Rs. 15 crores.

The maximum tenor or duration for home loans is 30 years for both lenders. To get a home loan from SBI, a borrower must be above 18 years of age and below 70. On the flipside, LIC lends to borrowers who are above 21 years and below 65 years in age.

When it comes to the lowest home loan EMI per lakh, with SBI, it is Rs. 652 for a tenor of 30 years, and with LIC, it is Rs. 659 for the same tenor. You can use this Home Loan Calculator available online to know the EMI amount based on the loan amount and interest rate being charged. SBI is a better option for a home loan than LIC as the lowest interest rate for SBI is lower at 6.8% compared to the lowest LIC rate, which is 6.9%. The cheapest home loans offer the lowest interest rates, which translates to low monthly EMIs because the interest outgo is the lowest. SBI is a clear winner here.

Also, SBI is a public sector bank, their interest rate is benchmarked to repo-linked lending rate (RLLR), and LIC’s interest rates are pegged to prime lending rate (PLR), the rate they are charging from their best customers.

Another reason why SBI is a better option is the average customer rating and review wherein they have rated SBI with 4.2 out of 5 compared to 3.4 out of 5 for LIC. It goes on to show that SBI is customer-centric, and their customers are satisfied. Additionally, if you are a woman, SBI will give a rebate in their home loan scheme’s interest rate, but this facility is not available with LIC Housing Finance. You can check the Home Loan Eligibility Calculator on their respective websites or CRED Club’s website.

SBI has another differentiating factor: the overdraft facility, which they offer on home loans. The interest payment reduces significantly as now you will have to pay interest only on the loan amount used. It is an ideal option for borrowers having their businesses with inconsistent cash flows. On the contrary, LIC Housing Finance does not offer such a facility on their home loans.

This was all about SBI and LIC Housing Finance home loans with their terms and conditions. You can use this information to finalize on the ideal lender which suits your requirement.