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Can I avail a home loan at 5.11% interest rate?

5.11% interest rate is an effective interest rate for first year for home loan borrowers considering the subsidy under Pradhan Mantri Awas Yojana (PMAY) and Income Tax benefit for a year.

 

For example: If your annual family income is Rs. 15 lakh and avail a home loan of Rs. 25 lakh from ICICI Bank with Credit Linked Subsidy Scheme (CLSS) of PMAY, then you would receive a subsidy of Rs. 2.30 lakh. Also on your above income, you would be able to avail income tax benefit of Rs. 72,244 for a year. Therefore, though the interest rate applied to your loan account is 9.05% p.a., the effective interest rate would be 5.11% p.a. for the first year considering the above benefits.