Loans for Construction in India | Interest Rates, Eligibility, Apply Online

Construction loans or home construction loans provide funding for building properties, whether it's your home or a real estate project. They help cover initial construction costs before obtaining larger funding. One can also avail a home construction loan for remodeling purposes. Due to the higher risk involved in these loans, construction loans might carry higher interest rates compared to conventional home loans.

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Construction Loan Interest Rates

Home construction loan interest rates can vary based on factors such as the lender, the borrower's creditworthiness, loan amount, and prevailing market conditions. Interest rates for construction loans might also differ from those for traditional home loans.

Banks and NBFCs	Up to ₹30 Lakhs	₹30 Lakh to ₹75 Lakhs	Above ₹75 Lakh
SBI	8.40% - 10.15% p.a.	8.40% - 10.05% p.a.	8.40% - 10.05% p.a.
ICICI Bank	8.75% p.a. onwards	8.75% p.a. onwards	8.75% p.a. onwards
HDFC	8.35% p.a. onwards	8.35% p.a. onwards	8.35% p.a. onwards
LIC Housing Finance	8.40% - 10.35% p.a.	8.40% - 10.55% p.a.	8.40% - 10.75% p.a.
Punjab National Bank	8.45% - 10.25% p.a.	8.40% - 10.15% p.a.	8.40% - 10.15% p.a.
Bank of Baroda	8.40% - 10.65% p.a.	8.40% - 10.65% p.a.	8.40% - 10.90% p.a.
Federal bank	8.80% p.a. onwards	8.80% p.a. onwards	8.80% p.a. onwards
Union Bank of India	8.35% - 10.75% p.a.	8.35% - 10.90% p.a.	8.35% - 10.90% p.a.
Tata Capital Housing Finance	8.70% p.a. onwards	8.70% p.a. onwards	8.70% p.a. onwards

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*Note: The interest rates provided above are subject to change. Visit the bank’s/NBFC’s official website for the latest information.

Eligibility Criteria For Construction Loan

To avail of home construction financing, individuals need to satisfy the following criteria.

Eligibility for Salaried

Age Limit: Ranges between 18 to 65 years.
Citizenship: Must be an Indian citizen.
Residence: A permanent residence in India.
Employment: The borrower must be a salaried employee and working for the current employee for at least 1 year.
Credit Score: Preferably a score of 750 or more.

Eligibility for Self-Employment

Age Range: From 18 to 65 years.
Citizenship: Indian citizenship is required.
Residence: A permanent address is necessary. If the residence is rented, the applicant should have been living there for a minimum of one year.
Employment: Self-employed individual.
Credit Score: A credit score of 750 or above is considered good.

Not sure of your credit score? Check it now!

Construction Loan EMI Calculator

Calculate your EMI for your construction loan with this simple and easy to use loan EMI calculator. Just enter your loan amount, interest rate, and loan repayment tenure and get your EMI amount instantly! Calculate now!

Loan Amount :

₹

Interest Rate (p.a.):

Months to Pay:

Monthly EMI	₹86
Principal Amount	₹1,000
Total Interest	₹32
Total Amount	₹1,032.00

Principal Amount Interest Amount

Year	Month	Principal (A)	Interest (B)	EMI (A+B)	Balance	Loan Paid to Date (%)

Documents Required For Construction Loans

The specific documents required for construction loans can vary depending on the lender and the type of construction project. However, here is a general list of documents commonly required for construction loans:

Categories	Documents Requires for Home Construction Loan
Proof of Identity	Any one of the following: - Aadhaar Cards - PAN Card - Passport - Voter ID Card
Proof of Address	Any one of the following: - Aadhaar Card - Utility Bill - Valid Passport - Voter ID Card
Proof of Income	Tax Returns (ITR) and income calculations for the individual applicant and the business entity over the past three assessment years, verified by a CA.
Financial Statements	(If business) Balance Sheets, Profit & Loss (P&L) statements, and Annexures/Schedules for both the applicant and the business entity over the past three years, certified by a CA.
Bank Statement	Account statements for the applicant and the current account statements for the individual or business entity, covering the last six months.
Property Documents	- Title Deeds - Estimate for construction - Photocopy of the plan sanctioned by Local Authorities - Encumbrance certificate
Additional Documents	- Duly filled application form with passport-size photographs of the applicant/applicants - List of shareholders - Partnership agreement for the business - Proof of own contribution - Bank statements showing payments for existing loans - Cheque for the processing fee made out to the lender

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*Please Note: The lender reserves the right to request additional documents in accordance with their policies.

In need of a loan? Apply now!

Features of Construction Loan

Home construction loans come with attractive features and benefits. Check out the major benefits of construction loans:

Tax Advantage

Save Tax under section
80C and 24B.

Attractive Interest
Rates

The interest rates
start at 8.35% p.a.

Long Tenure

Enjoy a long tenure
of up to 30 years

Balance Transfer
Options

Transfer the loan to
another bank for better
rates

Completely Online

Convenient online
application process.

Zero Hidden Charges

No extra hidden charges.

Steps to Apply For Construction Loan

You can also take a personal loan for home construction or renovation purposes. Try Buddy Loan Personal Loan. Follow these easy steps and submit your loan application today.

Step 1: Visit buddyloan.com or Download & install the Buddy Loan app (Android or iOS).
Step 2: Open the personal loan application page. Provide the mobile number and enter the received OTP.
Step 3: Specify the desired loan amount & personal email. Next, choose the Personal Loan option
Step 4: Choose the employment type (Salaried, Self-Employed, or Student) and the salary mode (bank or cash).
Step 5: Enter your work details (Including company name, years of service and Designation)
Step 6: Provide your personal information (Including Full Name, PAN, address DOB & Gender)
Step 7: Fill out the details of your communication address and income, then click 'Submit'.

Ready to take the next step? Apply now!

Frequently Asked Questions

Construction loans release money in stages as construction milestones are met during the building process.

Types of construction loans include home construction loans and commercial real estate construction loans.

Qualifying for a construction loan typically requires a detailed project plan, cost estimates, and a solid financial profile.

Yes, construction loans can be used for remodeling or renovations of existing properties.

Key factors influencing loan approval for construction projects include a solid project plan, financial stability, and creditworthiness.

Yes, there are specific construction loan options tailored for commercial projects.

Construction loans can be used to build your own home, providing funding throughout the construction phases.

Repayment terms for construction loans vary but often include a short-term, interest-only period during construction, followed by conversion to a traditional mortgage upon project completion.

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Loans For Construction

Construction Loan Interest Rates

Eligibility Criteria For Construction Loan

Construction Loan EMI Calculator

Documents Required For Construction Loans