HDFC Home Loans: Application and Prepayment Guide
Following the merger of HDFC Ltd into HDFC Bank, HDFC is one of the largest private sector mortgage providers in India. Known for quick processing, transparent terms, and robust online portals, HDFC Bank is a popular choice for home loans. This guide details HDFC Bank's loan options, explains its tranche-based EMI system, and shows you how to make online prepayments.
HDFC Home Loan Options
HDFC Bank offers home loan products tailored for different purchase stages:
- Housing Loan: For purchasing new or resale flats, bungalows, or builder floors.
- Plot Loans: For buying land or plots to construct a home.
- Home Improvement/Renovation Loans: For renovating, painting, plumbing, or updating an existing property.
- Home Extension Loans: For constructing new rooms or floors to expand your living space.
Understanding Tranche-Based EMIs
When purchasing an under-construction property, banks disburse the loan in stages (tranches) based on the progress of construction. HDFC offers two repayment options during this phase:
1. Pre-EMI Option (Interest Only)
You only pay interest on the disbursed loan amount. Full EMI payments begin only after construction is complete. While this option keeps your monthly outgo low during construction, it does not reduce your principal balance. This increases the total interest cost over the life of the loan.
2. Tranche-Based EMI (Principal + Interest)
You start paying full EMIs immediately, even before the loan is fully disbursed. The bank applies the principal component of your payments to reduce your outstanding balance. This shortens your loan tenure and saves you interest charges. This option is ideal if you have the cash flow to support full payments during construction.
To calculate the interest and principal split of your monthly payments, use our Home Loan EMI Calculator.
How to Make Prepayments on an HDFC Home Loan
In accordance with RBI guidelines, HDFC Bank does not charge prepayment or foreclosure penalties on floating-rate home loans taken by individuals for personal purposes. You can make prepayments using the following methods:
Online Prepayments via HDFC Customer Portal
- Log in to the HDFC customer portal (portal.hdfc.com) or the HDFC Net Banking app.
- Go to the **Home Loan Account** dashboard and select **Prepayment**.
- Enter the prepayment amount and complete the transaction using UPI, Net Banking, or a debit card. HDFC will update your loan balance within 2 working days.
Offline Prepayments
You can visit any HDFC home loan service branch to submit a check along with your loan account number and a written request specifying whether you want to reduce your monthly EMI or shorten your tenure.
We recommend choosing **tenure reduction** to maximize your interest savings. See our comparison of reducing EMI vs reducing tenure for more details.
HDFC Home Loan Fees and Charges
When applying for an HDFC home loan, keep the following upfront costs in mind:
- Processing Fees: Typically ranges from 0.5% to 1.5% of the loan amount, capped at a maximum limit depending on whether the borrower is salaried or self-employed.
- Legal and Technical Fees: Charged for verifying property titles, executing deeds, and evaluating construction progress.
- Conversion Charges: Charged if you request the bank to reduce your floating interest rate during the loan tenure to match current market offers.
Frequently Asked Questions
To understand the basics of loan payments, read our article What is EMI?, or see our guides on home loan prepayments and EMI vs tenure reduction. You can also explore our calculators in the Calculator Hub, or view our team details on our About Us page.