HDFC V/s SBI Which is Better for Home Loan 19 comments

(Last Updated On: April 15, 2018)

HDFC Vs SBI Home Loan

HDFC V/s SBI Which is Better for Home Loan

HDFC Ltd is a NBFC in field of housing finance. Housing Finance companies are regulated from National Housing Bank & Reserve Bank of India.

On other hand SBI is mainframe bank serving all type of retail and corporate account you can think of. Giving them all services from debit cards, cheques, demand drafts to commercial wire transfer. For corporate they serves machine finance, project finance, bank guarantee etc. Then comes added to retail sector like Credit Card, Car loan, & Home Loan

Did I bored you telling about different services of SBI? You already knew it. Well I didn’t meant to. Here we are talking about home loan. I wanted to show you HDFC is dedicatedly dealing in Home Loan. On other side SBI is dealing with everything in financial sector. Shall you expect superior service for home loan from staff of bank who is already burdened with many products?

HDFC on other hand is dedicated to one business. To be leader and stay competitive they adopts superior process and provide good service. As we know a horse knows another horse and a donkey know another donkey. In such an environment no professional organization with only one business to do, will ever annoy their customer. On other hand for SBI to even get interest certificate you may have to keep calling branch so you can get tax benefit.

But it is not only about service, there are plus and minuses of both companies. We have listed 19 points of comparison. You can give weightage to every point based on your requirement.



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SBI has issues on quality of customer service. if you have lot of time and patience, you can go to SBI you will get better deal on rate of interest. After disbursal you require very less interaction from branch because EMI will be debited from ECS.

HDFC is leader in home loan because of customer service, SBI too is improving it

At the end, I will say, you can do all working and chose a home loan deal best suited to you. Or you can take our help for most affordable loan OFFERS With door step service from your home or office. We don’t charge anything our services. Simply fill your details. We will do all this for you


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19 thoughts on “HDFC V/s SBI Which is Better for Home Loan

  • raghupathy


  • Peeyush

    What abt conversion charges to lower interest rate as HDFC works on RPLR…So every time MCLR is changing they create new RPLR for new customers with lower ROI but expect existing customers to pay conversion fees if they want to get converted with new scheme. Which was around 10k + service charges in 2015 then reduced to 5k + service charges… Not sure what they charge now. But their concept is simple… Extract as much money as possible from customers. Apart from this…Their branch executives have lots of attitude and talk rudely…. On top of this, they even don’t inform u on ROI changes so that you can go to bank and get converted to lower ROI in first month itself.
    ROI increase happen without any conversion fees though… As they change the existing schemes based on market increase.

    On other side…I don’t think that this is the case with SBI… they don’t charge any conversion fees and interest will reduced based on MCLR changes on monthly basis.

    I am sure abt HDFC on this unfriendly process as I am a customer of that…But not sure abt SBI as came to know from others. Hope this is true.

    • Ravinder Bhutani Post author

      Hi Peeyush,

      Currently they charges 2500/- + ST

      Rate hike happens automatically with all institution, including PSU banks, but to reduce ROI all takes conversion charges. Yes in SBI too, it does not happen automatically. Customer’s pays for it.

      If any staff misbehaves or talk rudely, you can sure make complaint with name and employee id. But you don’t have such privilege with PSU organisations.

      Fortunately I am customer of SBI as well as HDFC. On not a single incident SBI staff talked rudely, but they simply won’t move anything. While dealing SBI I always prefers online banking.

  • Sab

    I experienced from both SBI as well as HDFC. Initially it seems SBI is better. But later you feel sorry for this during processing. On the other hand HDFC is far better and offer more flexibility and choices. In simple HDFC is better and customer friendly. To be frank, SBI is not customer friendly even they don’t adjust for small issues. In fact SBI (Tamilnadu) insists for Personal Life Insurance SBI Life Insurance (???) please note i am not meaning ‘House insurance” as it is compulsory. Though initially I was pro-SBI, because of their customer services and hidden charges, I changed. HDFC is far better than SBI.

  • Wilson Mendes

    Hi Folks,
    I had availed home loan from HDFC Limited in 2008 for about 12 lakhs my age than was 27 in 2015 I have closed the loan , now I am going for my 2nd home loan and I have opted SBI. Some piece of information would like to share with you all.
    1.HDFC do not implement/pass over the (RPLR) benefits to end user immediately they have a cap of 3 months.
    2. We have to understand the methodology of ROI calculation. HDFC calculates as per RBI repo rate + base rate(Spread) most of the people don’t know that the banks are free to fluctuate the Spread rate that’s how they loot you if you don’t monitor your ROI religiously. Remember the banks do not intimate you about the change in ROI you have to keep checking it through their mobile app or visit the branch. First 3-4 years the banks will shoot your ROI very high, beginners do not pay attention on this point as we are young & enjoying life as the EMI are fixed it doesn’t hits us much , later on we get a shock.
    3. SBI functions some what this way. Their ROI calculation is MCLR+ the base rate. As per RBI every bank has to review MCLR every month and pass on the benefits to end user , that is why SBI is the bank who will implement the Rapo rate changes immediately unlike other banks.Even in SBI you need to monitor your ROI every month.
    Hope my observation is correct and relevant .Pardon me for my English if anything is wrong. Kindly correct me if my understanding is wrong. Appreciate.

    • Ravinder Bhutani Post author

      Hi Wilson,

      This is important piece of information you have shared. In banks ROI for existing customer is reviewed monthly, while for NBFC it is reviewed quarterly.

      You have rightly emphasized, Financial institution will not inform you for your rate change personally. You must keep watch to see if it is competitive or not.

  • Goutam K

    Agree on the business side of things. I have been a SBI customer and fairly satisfied.
    The main reason for going with them is MaxGain… park as much funds as possible and take them out as and when you need while saving interest on per day basis.

    Moreover, with OD facility I withdrew money from (which I had paid as premium) instead of opting for Vehicle Load (9.45 vs 9.85)


    I gone through the above said comparison. I really shocked how you can encourage the customers to HDFC Bank. since I know few things about SBI Home Loan, I wanted to mention the same which you omitted to write.

    1. No Processing Fee for sanction of Housing Loan till 31/03/2016
    2. No Pre – Payment Penalty
    3. No Minimum and Maximum amount restriction for Pre- payment
    4. No Pre – Closure Penalty
    5. SBI Maxgain Scheme – Home Loan Under Overdraft facility
    6. Home Loan can be sanctioned for 1.20% of actual eligibility – SBI Flexi Home Loan.

    All the above said facilities are not available in HDFC Bank. Please go to any nearest SBI for Home Loan

    • Ravinder Bhutani Post author

      Hi Rajesh,

      Thanks for writing in. Some time back I had written, this blog comparing Processing Fee of SBI and HDFC (Click to read).Yes there is nil PF for SBI home loan, but there are legal & valuation charges involved which is roughly 5000/-.

      As per RBI 2011 guideline no bank/ housing finance company is allowed to charge any pre-payment, part-payment, foreclosure charges if client has opted for floating rate of interest.

      Moreover for SBI maxgain rate of interest charged is 0.25% higher (Click to read). I had done detailed calculation, If customer keeps at-least money equivalent to 2 EMI in account which is linked to your home loan account, then effect of this higher rate will be neutralized. In case customer’s average balance is less then 2 EMI, then he / she looses. If a customer keeps money more than 2 EMI in account(Generally Businessmen / Business Women), then yes he / she will actually gets benefit in terms of lower rate.

      Thing I made out is, for businessmen / business women HDFC (and many other financial institutions)uses many surrogate products to define eligibility. That can go far beyond 120% eligibility on documented income.

      I do not encourage customer to any specific bank. I deals with all major banks including SBI. I try to give honest feedback to customer.

      Some time back we were facing great difficulty in contacting HDFC staff. They have taken off IVR facility to contact staff directly through extension number. Their board number for regional office 011-41596500 was (still) not being answered. When their staff was not even responding to mail & with no mean to speak to them, I clearly mentioned “They too have gone in to Sarkari age”

      It is only their service which separates them from “Sarkari banks”. When they are unable to give better service, then what is difference.

  • Lalit Gupta

    HDFC roi is too high.
    RTGS facility N/A that incurs the customer loss of time and postal chrges.
    Insurance of loan protect is too costly whereas SBI is charging only Rs 60 per month.
    Pls justify, thanks.

    • Ravinder Bhutani Post author

      Dear Mr. Lalit,

      Sorry for delay in response.

      You are right HDFC don’t have RTGS facility as it is non banking financial institute. It is not possible to give account / RTGS detail to customer so you can make them payment. it is impossible to trace those payment when thousands of customers pays in same account. So a client account number has to be personal and exclusive

      This is also reason, why banks offering home loan can offer you flexi home loan where they links your home loan but NBFC cant do so.

      As far as cost of insurance is concerned, every one agree home loan protectors are not cheep compare to pure term insurance. Compared to other home loan protector HDFC is not cheapest, still not most expensive. Regarding HDFC V/s SBI cost, I have never personally compared their premium for diffrent age and loan tenure.

      What I can say for sure SBI premium cant be 60/- per month. It means you pays only 14400/- for a loan tenure of 20 Years (60/- x 240 months). that too including interest of 20 years. If we consider only principle component it is 6400/-. It means for a loan of 6400/- you will pay EMI of 60/- for 240 months because loan protector is funded from financial institute on which you are required to pay extra EMI in your loan.

      Here you have not mentioned, loan amount and age of borrower. In case this EMI on per lakh premium, then take my words, it is really very costly.

      Please feel free for any further quarry and comment. I won’t reply late like this.