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HBA vs Bank Home Loan Calculator

Short answer

HBA charges simple interest: you repay the principal first, in up to 180 instalments, then the interest in up to 60, and the rate for 2026-27 is 7.10%. On ₹25 lakh, total HBA interest is about ₹13.39 lakh against about ₹27.07 lakh on a 20-year bank loan at an assumed 8.5%, a saving of roughly ₹13.68 lakh on those assumptions.

Last checked · 2 key figures from the fact register

Key facts

Key facts on this page with their source and the date each was checked
FactValueSourceDate checked
HBA interest rate7.10% for 1 Apr 2026 to 31 Mar 2027 Official order, read on a mirrorGovtStaff: HBA interest rates for 2026-27 (opens in a new tab)
HBA limits (2017 Rules)Least of 34 months' basic pay, ₹25 lakh, the cost, or repaying capacity; simple interest Official order, read on a mirrorStaffNews: HBA rules 2017 (opens in a new tab)

Central government employees can take a House Building Advance (HBA) at a rate fixed by the government each year. The rate for 2026-27 is 7.10%. HBA works differently from a bank loan: it charges simple interest, you repay the principal first in up to 180 instalments, and then the interest in up to 60. Enter your amount and a bank's current offer to compare. HBA has its own ceilings and conditions, so use this for comparison only.

From the fact register: 7.10% for 1 Apr 2026 to 31 Mar 2027

Assumption. Enter your bank's current offer.

Interest saved with HBA

₹13,68,294

HBA: monthly principal for 180 months
₹13,889
HBA: monthly interest for the next 60 months
₹22,311
HBA total interest
₹13,38,646
Bank EMI per month
₹21,696
Bank total interest
₹27,06,939

How it is calculated

  • HBA: simple interest on the outstanding principal. The principal is repaid first in equal instalments (up to 180 months), then the accumulated interest in up to 60 instalments, so the maximum is 20 years.
  • HBA interest = principal × monthly rate × 90.5 (the sum over 180 months of the reducing balance)
  • Bank loan: EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), compounded monthly
  • Interest charged during construction is not included. HBA has its own ceilings and eligibility. This is a comparison, not a quote.

Estimates for information only; not financial, tax or legal advice.

Worked example

Example (the default inputs): ₹25 lakh. HBA at 7.10% means about ₹13,889 a month of principal for 180 months, then about ₹22,311 a month of interest for 60 months, with total interest of about ₹13.39 lakh. A bank loan of 20 years at an assumed 8.5% has an EMI of about ₹21,696 and total interest of about ₹27.07 lakh. HBA saves roughly ₹13.68 lakh in interest on these assumptions. The bank rate is an assumption, and interest during construction is not included.

Frequently asked questions

What is the HBA rate for 2026-27?

7.10% a year from 1 April 2026 to 31 March 2027, set by Ministry of Housing and Urban Affairs OM dated 13 May 2026.

How much can I borrow?

For a new house, the least of 34 months' basic pay, ₹25 lakh, the cost of the house or your repaying capacity, under the HBA Rules 2017. Enlargement is limited to 34 months' basic pay or ₹10 lakh.

Who is eligible?

Permanent employees, or temporary employees with 5 years of continuous service. If both spouses are central employees, they can take it jointly or separately.

Is interest charged while the house is being built?

Yes, simple interest accrues from the date of drawal. This calculator does not include that period, so real HBA interest will be somewhat higher.

Related perks

Sources and status

Each figure on this page comes from the fact register. What the badges mean.

  • Official order, read on a mirrorchecked 2026-10-16

    HBA interest rate is 7.10% for 1 Apr 2026 to 31 Mar 2027. MoHUA OM No. I-17015/2(2)/2022/H.III(e-9126778) dated 13 May 2026

    GovtStaff: HBA interest rates for 2026-27

  • Official order, read on a mirrorchecked 2026-10-16

    HBA Rules 2017 (MoHUA OM 09.11.2017): new house is the least of 34 months' basic pay, 25 lakh, the cost, or repaying capacity. Enlargement: 34 months' basic pay or 10 lakh. Simple interest. Permanent employees, or temporary employees with 5 years' continuous service. Principal over up to 180 instalments, then interest over up to 60 (20 years maximum). If both spouses are central employees, they can take it jointly or separately

    StaffNews: HBA rules 2017

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Estimates for information only; not financial, tax or legal advice. Disclaimer.