PNB Housing Finance: Home Loan Review

PNB Housing Finance: Home Loan Review

PNB Housing Finance Ltd. offers a range of home loan products best suited to resident Indians and older borrowers.

Good for

  • Borrowers who may be too old to apply at other lenders

Bad for

  • Borrowers seeking the lowest interest rates
  • NRIs who want a long loan tenure and high loan-to-value ratio

Editor's Rating

3.0/5.0

PNB Housing Finance Ltd. offers a range of home loans best suited for resident Indians and older borrowers. Though PNB home loans come with higher interest rates than the average rate range in India, borrowers with a high CIBIL credit score can benefit from lower rates. NRIs can avail PNB home loans, too, but will find shorter loan tenures and less home loan eligibility than resident Indians.

Summary of PNB HFL Home Loans
30 year tenures for both self-employed and salaried individuals
Higher interest rates compared to the market
NRIs will find higher interest rates and shorter loan tenures

Table of Contents

What Makes PNB Home Loans Stand Out to Borrowers

For a non-bank housing finance company, PNB offers good home loan options with long maximum loan tenures. Unlike other popular lenders like LIC and DHFL, PNB provides borrowers with a 30 year maximum tenure, regardless of job position. So while PNB home loan interest rates are higher than the market rate, the lender offers ample time for loan repayment. This leads to smaller equated monthly instalments (EMIs) and less home loan interest paid over time.

Below, you can find different PNB Housing loans and their maximum loan tenures, as well as the percentage of your property value that can be covered by PNB Housing Finance, otherwise known as the loan-to-value ratio (LTV).

PNB Housing Loans, Maximum Loan Tenure and LTV Range

TypeMax TenureLTV Range
Home Purchase30 years75% - 90%
Home Construction30 years75% - 90%
Home Extension30 years75% - 90%
Home Improvement30 years75% - 90%
Residential Plot30 years75% - 90%
NRI Home Loans
  • 15 years for purchase and construction.
  • 10 years for improvement.
75% - 80%
Unnati Home Loans
  • 90% for salaried borrowers.
  • 67% for self-employed borrowers.
PMAY Option20 years

NRIs do not have access to the same PNB home loan benefits as resident Indians. For instance, NRIs can avail a home loan with a maximum tenure of only 15 years in the case of home purchase and construction, and a loan term of 10 years for home improvement. Further, NRI home loans will only cover a maximum 80% of property value, while resident Indians can avail a home loan with up to 90% coverage.

Read more: LIC Housing Loan Review | DHFL Home Loan Review

PNB Home Loan Interest Rates

PNB HFL charges relatively high interest rates on their home loans. Below, we've compared the interest rate range you can expect from PNB housing loans to the average home loan interest rate in India. You can see interest rate ranges for both salaried individuals and self-employed non-professionals.

PNB Housing Loan Interest Rate Range

TypeSalaried and ProfessionalsNon-Professionals
Home Purchase7.90% - 9.50%7.95% - 9.70%
Home Improvement8.60% - 9.75%8.85% - 9.95%
Residential Plot Loan8.90% - 10.50%8.95% - 10.70%
NRI Home Loans9.25% - 11.00%9.50% - 11.50%
Unnati Home Loans10.75%12.00%
PMAY Option2.63% after interest subsidy.
Average Home Loan Interest Rate in India7.54% to 8.41%7.60% to 8.53%

Based on our research of over 30 banks and home loan lenders, PNB housing loan interest rates are higher than the market average. Even when compared to other non-bank housing finance companies, who generally have higher interest rates than bank lenders, PNB Housing's interest rates are on the higher side.

It's important to note that a PMAY home loan option is good for eligible borrowers. PNB Housing calculated the effective interest rate at 2.63% p.a., which most banks do not do on their website.

Read more: 2020 Home Loan Interest Rates of All Banks

PNB Home Loan Eligibility

Consider this if you seek a PNB Housing Loan

Maximum Loan Tenure 30 years
Processing Fee 1% of loan amount (minimum Rs. 10,000) + GST

PNB housing loans benefit older borrowers with a maximum age of 70 years old. While the minimum age is not available online for most PNB home loan options, a PMAY borrower must be at least 18 years old to avail a housing loan.

If you are a low income earner, you will find that PNB housing loan options ask for a high minimum income requirement. For instance, you (or you and your co-applicant) must earn at least Rs. 18,000 in total income if you wish to be eligible for a Unnati home loan.

Read more: Home Loan Eligibility: Compare Eligibility Criteria by Bank

Like many home loan lenders, PNB Housing determines your home loan eligibility based on your CIBIL credit score. Click below to view different home loan interest rates based on your credit score for various PNB housing loan schemes.

PNB HFL Home Purchase Loans have interest rates starting at 7.90%.

Credit ScoreSalariedSelf-Employed
Credit Score less than zero9.00% – 9.50%9.20% – 9.70%
0 to 6509.00% – 9.50%9.20% – 9.70%
650 to 7008.80% – 9.30%8.95% – 9.45%
700 to 7508.55% – 9.05%8.80% – 9.30%
750 to 8008.25% – 8.75%8.65% – 9.15%
800+7.90% – 8.40%7.95% – 8.45%

PNB HFL Residential Plot Loans have interest rates starting at 8.90%.

Credit ScoreSalariedSelf-Employed
Credit Score less than zero10.00% – 10.50%10.20% – 10.70%
0 to 65010.00% – 10.50%10.20% – 10.70%
650 to 7009.80% – 10.30%9.95% – 10.45%
700 to 7509.55% – 10.05%9.80% – 10.30%
750 to 8009.25% – 9.75%9.65% – 10.15%
800+8.90% – 9.40%8.95% – 9.45%

PNB HFL Home Improvement Loans have interest rates starting at 8.60%.

Credit ScoreSalariedSelf–Employed
Credit Score less than zero9.25% – 9.75%9.45% – 9.95%
0 to 6509.25% – 9.75%9.45% – 9.95%
650 to 7008.95% – 9.45%9.15% – 9.65%
700 to 7508.85% – 9.35%9.05% – 9.55%
750 to 8008.75% – 9.25%8.95% – 9.45%
800+8.60% – 9.10%8.85% – 9.35%

If you have a CIBIL credit score of 800 or more, you can avail a home loan with the lowest interest rates. Borrowers with a low credit score or CIBIL score below 650 will avail the highest PNB home loan interest rates.

PNB Home Loan Processing Fee and Other Charges

For home loan applications, PNB charges a 1.00% processing fee of the total loan amount. This is standard compared to other home loan lenders, but it is not the lowest you can find in the market.

Check below to see processing fees and charges you may come across when availing a PNB housing loan.

Processing Fee1.00% of loan amount + GST, minimum Rs. 10,000.
Prepayment Penalty on Floating Rates (for individual borrowers)Free
Prepayment Penalty on Floating Rates (for non individual borrowers)2.00% of principal prepaid + GST
Prepayment Penalty on Fixed Rates3.00% of principal prepaid + GST
Conversion Charges (Fixed to Floating)2.00% of principal outstanding + GST
Conversion Charges (Floating to Fixed)0.50% of principal outstanding + GST
Overdue Charge2.00% of overdue payment p.m. + GST
Change of Repayment ModeRs. 500 + Tax
EMI Payment Fee on Account of Non-Submission of PDC/ NACH Mandate FormRs. 300 + Tax
Loan Preclosure Statement or Photocopy of Property DocumentsRs. 500 + Tax
Cheque/ NACH Mandate Form ReturnRs. 500 + Tax
CERSAI FeesRs. 100 + Tax

If you seek to pay down your home loan in advance, you may have to pay a prepayment penalty fee. If you are an individual borrower, PNB Housing will not charge you a prepayment penalty fee as long as your home loan has a floating interest rate. If you aren't an individual borrower, meaning you applied with a co-applicant, you will be charged a 2.00% prepayment penalty. This is considered high, as most banks do not charge a prepayment fee on home loans with floating interest rates.

For home loans with fixed rates, PNB housing will charge a 3.00% prepayment penalty, which is also higher than what most banks and home loan lenders charge.

How to Apply for PNB Home Loan: Application Process

You have the option of applying in person or online for a PNB housing loan. If you choose to start your home loan application online, you will have to enter your contact information so that a PNB Housing customer service official can contact you. PNB Housing claims you can avail a home loan within 3 hours if you choose the instant application option found on their website.

Below, you will find the different required documents you will need for your home loan sanction and approval.

Required Documents for All Borrowers

Filled Application Form with Photograph
Age Proof (PAN Card, Passport, any other Certificate from Statutory Authority)
Residence Proof (Passport, Driving License, Telephone Bill, Ration Card, Election Card, any other Certificate from Statutory Authority)
Education Qualifications: Latest Degree (for Salaried and Self-Employed Professionals)
Processing Fee Cheque in favour of PNB Housing Finance Ltd.
Photocopy of Title Documents of the Property, Approved Plan.

Additional Required Documents

Salaried IndividualsSelf-Employed Individuals
Latest Salary-slips for 3 monthsCertificate & Proof of business existence along with Business Profile
Form 16 for last 2 yearsLast 3 years Income Tax returns (self and business) with CA-Certified Profit & Loss Account & Balance Sheets
Last 6 months Bank Statements (salary account)Last 12 months Bank Account Statements (self & business)

Your home loan disbursement will be made after you've submitted your Know Your Customer (KYC) documents, proof of income documents, and property documentation.

If you seek to avail a home purchase loan, your full loan amount will be paid to the seller at the time of transfer. For home construction loans, your loan amount will be disbursed in stages based on the progress of your home construction.


Natalia Sanchez-Kumar

Natalia Sanchez-Kumar is a Junior Research Analyst at ValueChampion, specialising in home loans in India. She is a History graduate of New York University and has worked in the area of social impact, Future of Work and socio-technological research in the US and India. She has co-authored policy proposals alongside the International Labour Organisation in Sri Lanka and the Maldives, as well as hosted a data privacy conference with Facebook in New Delhi.