Home Loan For Farmers

Farmers looking for a home loan at attractive rates can avail of multiple home loan schemes specially designed for them. Whether you need a loan for farming land, a home loan for farmers, or a farmhouse loan, numerous options are available.

These loans are designed with farmers' unique needs in mind. Farmers' home loan requirements typically include proof of farming income, land ownership documents, and basic identification. Farmers can access the necessary funds to purchase or construct a home by meeting these requirements, ensuring a stable and comfortable living environment.

Interest Rates of Home Loans for Farmers

Refer to the table below to study the interest rate offered by different lenders to farmers or agriculturists who are looking to acquire a home loan:

Name of the Lender	Interest Rate(p.a.)
HDFC Rural Housing Loan	9.40%
Bank of India Kisan Ghar & Agri Mortgage Loan	9.25%
Canara Bank	8.40%
Union Bank of India	8.35%
Bank of Maharashtra	1-Y MCLR+0.50% p.a

Home Loan for Farmers : Documents Required

Following are the documents required that the lender generally asks if a farmer wants to avail of a home loan:

• Provide land ownership documents such as title deeds, sale deeds, etc.
• Submit proof of identity, such as an Aadhaar card, passport, etc.
• Provide proof of address, such as utility bills or rent agreements.
• Include income proof and recent bank statements.
• Complete and submit the application form with passport-sized photographs.

Features & Benefits of Home Loans for Farmers

Home loans for farmers come with several features and benefits to address the financial needs of farmers in the agricultural community. Here are the key features and benefits of home loans for farmers:

Flexible Loan Options

Farmers can benefit from the special features of various lenders’ specifically designed loan schemes. The interest rates are comparatively more attractive than the general home loan rates, and these loans often come with terms and conditions specifically designed to meet the unique needs of farmers.

No Collateral for Small Loans

Many lenders offer home loans to farmers that require no collateral. This benefits farmers with no financial backup to pledge but urgently require a home loan.

Moratorium Period

Many banks offer a moratorium of up to 18 months on farmer home loans. This benefits farmers who face sudden financial hardship and cannot make timely EMI payments. The moratorium period is a relief and can give farmers ample time to resume their repayment journey.

Low Processing Fee

Compared with general home loan schemes, the processing fee for a home loan for farmers is significantly low. Minimal fees reduce the loan’s overall cost, making it easier for farmers to manage their finances effectively​.

Flexible Repayment Options

These loans come with flexible repayment tenures, allowing farmers to choose a term that best suits their financial situation. Repayment periods can extend up to 30 years, providing ample time to manage finances and repay the loan comfortably.

Home Loan For Farmers: Eligibility Criteria

The eligibility criteria for a home loan for farmers may vary from lender to lender. Let us explore the eligibility criteria of different banks offering home loans to farmers:

HDFC Rural Housing Loan

Age:	Applicants must be between 18 and 70 years old.
Profession:	The applicant can be salaried, self-employed, or an agriculturist.
Nationality:	The applicant must be an Indian resident.
Tenure:	The loan repayment period can be up to 30 years.

Bank of India Kisan Ghar & Agri Mortgage Loan

Eligible Applicants:	Farmers involved in agricultural or allied agricultural activities who hold Kisan Credit Card (KCC) accounts.
Age Limit:	The borrower’s age at loan maturity must not exceed 70 years.
Additional Requirement for Older Applicants:	For applicants older than 55 years, a suitable co-applicant must be included, considering factors like age and succession planning.

Best Home Loan Schemes for Farmers

Read below to explore the home loan schemes for farmers offered by different banks:

HDFC Rural Housing Loan

HDFC Rural Housing Loan is a dedicated financial product that addresses the housing needs of individuals in rural areas of India. This loan scheme supports the purchase, construction, or renovation of homes in these regions, thereby contributing to the government’s mission of “Housing for All.” 

Interest Rates:	The interest rates for HDFC Rural Housing Loans range from 9.40% to 10.75% per annum.
Loan Amount:	The loan covers 75% to 90% of the property cost, providing substantial financial support for rural housing needs.
Loan Tenure:	The loan tenure can extend up to 30 years, allowing borrowers to repay the loan comfortably over a long period.
Purpose:	The loan can purchase under-construction, existing, or new residential properties.
Processing Fee:	The processing fee for the loan is up to 1.50% of the loan amount or Rs. 4,500 plus GST, making it relatively affordable to apply.
No Mortgage on Agricultural Land:	One significant benefit is that eligible borrowers can avail of the loan without mortgaging their agricultural land, simplifying the borrowing process.

Bank of India Kisan Ghar & Agri Mortgage Loan

The Kisan Ghar & Agri Mortgage Loan from the Bank of India is designed to provide financial support to farmers who want to construct farm structures combined with dwelling units. This loan aims to enhance the living and working conditions on farms, promote agricultural development, and ensure a better quality of life for farmers.

Low Interest Rates:	Offers competitive interest rates to make borrowing affordable.
No Hidden Charges:	Transparent loan process with no hidden fees.
Minimal Documentation:	Requires fewer documents for a hassle-free application process.
Quick Processing:	The application can be completed online within 15 minutes.
Versatile Usage:	Funds can be used to construct new structures or upgrade existing ones on farms.

Canara Bank Housing Loan For Agriculturalists

Canara Bank provides a dedicated housing loan scheme for agriculturalists. The scheme aims to support their housing needs, whether for building, buying, or renovating homes, thereby enhancing their living conditions and supporting agricultural development.

Features of Canara Bank Housing Loan for Agriculturalists

Interest Rates:	Competitive floating rates start at 8.40% p.a., and fixed rates start at 9.75% p.a.
Loan Amount:	No upper limit, based on the applicant’s income and financial profile​.
Loan Tenure:	Up to 30 years​
Purpose:	Can be used for purchasing, constructing, or renovating houses, including site purchase and construction.
Processing Charges:	Minimal charges with periodic waivers during special loan festivals.
No Prepayment Penalty:	Flexibility to repay the loan early without penalties.
Complimentary Credit Card:	Borrowers receive a complimentary credit card​.

Union Bank of India Union Awas Home Loan

Union Bank of India offers the Union Awas Home Loan, a specialised scheme designed to support individuals in rural and semi-urban areas in purchasing, constructing, or renovating their homes. This loan aims to provide affordable housing solutions to enhance residents’ living standards in these regions.

Interest Rates:	Competitive rates starting at 8.35% per annum.
Loan Amount:	Up to Rs. 20 lakhs for semi-urban areas and Rs. 15 lakhs for rural areas.
Loan Tenure:	Repayment period up to 30 years.
Purpose:	Suitable for purchase, construction, and renovation of houses.
Processing Charges:	0.50% of the loan amount, up to a maximum of Rs. 15,000 plus GST.
Moratorium Period:	Up to 36 months for purchase/construction and up to 12 months for repair/renovation.
No Prepayment Penalty:	No penalty for early repayment.
Eligibility:	Available to residents of rural and semi-urban areas, including salaried individuals and good farmers.

Bank of Maharashtra Scheme of Construction of Farmhouse to Agriculturists 

The Bank of Maharashtra offers a special scheme to assist agriculturalists in constructing farmhouses. This scheme financially supports farmers who want to build farmhouses on their agricultural land. The initiative is designed to help farmers have a dwelling unit on their farms. It can also serve other purposes, such as storing agricultural produce, housing farm implements, accommodating livestock, and enhancing effective farm management.

Purpose:	Financial support for constructing a farmhouse on agricultural land.
Eligibility:	Farmers engaged in agriculture and allied activities with a minimum of 2.5 acres of irrigated land.
Age Limit:	Applicants must be at least 18 and not exceed 65 years old at the time of application.
Loan Amount:	Up to Rs. 10 lakh for farmers with 2.5 acres of irrigated land; up to Rs. 50 lakh for those with 5 acres.
Interest Rate:	Based on the 1-Year MCLR plus applicable margins.
Repayment Period:	Up to 15 years, including a moratorium period of up to 18 months.
Security:	Mortgage of the agricultural land and the farmhouse constructed on it.
Insurance:	The constructed farmhouse must be insured for its full value.

Home Loan For Farmers : Fees & Charges

The applicable fees and charges on a home loan for farmers vary from lender to lender. Here is a typical range of fees and charges on the home loan for farmers:

Fee/Charge	Range
Processing Fee	0.25% to 1% of the loan amount
Administrative Charges	Rs. 2,000 to Rs. 10,000
CERSAI Fee	Rs. 300 to Rs. 500
Valuation Fee	Rs. 1,000 to Rs. 5,000
Document Verification Fee	Rs. 200 to Rs. 500
Stamp Duty and Registration Charges	5% to 7% of property value
Prepayment/Foreclosure Charges	0% to 3% of the outstanding principal
Late Payment Fee	1% to 2% of the overdue amount