If you are planning to buy a home and looking at home loans, you have probably come across the terms “fixed” and “floating” interest rates. These are two types of home loan interest rates that banks and financial companies, like BigMudra, offer on home loans. But what do they really mean? And more importantly, which one is better for you in 2025?
In this blog, we will explain everything about BigMudra’s home loan interest rates, how fixed and floating rates work, and how things like the RBI repo rate can affect your EMIs. Let’s dive in.
What is a Home Loan Interest Rate?
A home loan interest rate is the extra money you pay over your loan amount (principal). When you take a loan, the bank or lender charges interest as a cost of lending you the money. This interest can be fixed (same throughout) or floating (changes over time).
BigMudra’s Home Loan Options
At BigMudra, we offer both fixed and floating interest rate options to suit different needs. Here’s a simple explanation of both:
Fixed Interest Rate
What it Means:
In this option, your interest rate remains the same throughout your loan period (or for a set number of years).
Example:
If you take a loan of ₹30 lakhs at 9% interest for 20 years, and the rate is fixed, your EMI will remain the same every month for the full 20 years, no matter what happens in the market.
Pros:
- Stability: Your EMI stays constant. No surprises.
- Good for planning: Great if you like to stick to a fixed budget.
Cons:
- You may end up paying more if market rates fall in the future.
- Fixed rates are usually slightly higher than floating rates.
Floating Interest Rate
What it Means:
Floating rates change based on market conditions. They go up or down depending on factors like the RBI repo rate.
Example:
Let’s say you take the same ₹30 lakh loan at 8.5% floating rate. If RBI reduces the repo rate, your interest may come down to 8.2%, lowering your EMI. But if the repo rate goes up, your interest might increase to 8.8%, and your EMI will go up too.
Pros:
- Lower initial rate: Floating rates are usually cheaper than fixed ones at the beginning.
- Chances to save money if rates fall over time.
Cons:
- EMI may increase anytime. Not ideal if your budget is tight.
- Less predictable, which might make planning a bit harder.
Read More: Understanding Bajaj Housing Finance’s Affordable Housing Schemes
BigMudra’s Current Interest Rates (2025)
As of April 2025, BigMudra’s home loan interest rates are:
- Fixed Rate: Starting from 9.10% p.a.
- Floating Rate: Starting from 8.50% p.a.
(Note: These rates may vary based on your credit score, loan amount, and repayment period.)
What Affects These Rates?
BigMudra keeps a close eye on market conditions to offer competitive rates. The biggest factor that affects floating rates is the RBI repo rate.
What is the RBI Repo Rate?
The RBI repo rate is the rate at which the Reserve Bank of India lends money to commercial banks. If this rate goes up, banks also increase their interest rates for borrowers. If it goes down, banks usually lower their rates.
How It Impacts BigMudra Rates:
- If the repo rate increases, BigMudra’s floating rate may also rise.
- If the repo rate drops, floating rates may become cheaper.
- Fixed rates usually stay unaffected for the period they are fixed, but they may change when the fixed term ends.
In 2025, RBI has taken a balanced approach to the repo rate to manage inflation while supporting economic growth. So, floating rates are currently stable, but may move slightly based on global economic conditions.
Which One Should You Choose?
It depends on your situation. Here’s a simple guide:
| Your Situation | Best Option |
| Want stable EMIs | Fixed Rate |
| Think rates will fall | Floating Rate |
| Planning long-term | Floating (you may save more) |
| Planning short-term | Fixed (safe and stable) |
| EMI flexibility needed | Floating |
| Want peace of mind | Fixed |
You can also choose hybrid options, where your loan starts with a fixed rate for a few years and then switches to floating. BigMudra offers this flexibility too.
Example: EMI Comparison
Let’s compare EMIs for a ₹30 lakh loan for 20 years:
| Type | Rate | EMI (Approx.) |
| Fixed | 9.10% | ₹27,173 |
| Floating | 8.50% | ₹26,035 |
As you can see, floating saves you money at the start, but the amount can go up or down later.
Tips Before You Choose
- Check your credit score: Better score = lower rate.
- Compare offers: Ask BigMudra for both options and calculate the total interest paid.
- Look at your cash flow: Can you handle EMI changes?
- Use EMI calculators: Try different scenarios to see what fits you best.
- Talk to a BigMudra advisor: We are always happy to guide you.
Final Thoughts
Choosing between fixed and floating home loan interest rates is a big decision. At BigMudra, we believe in giving you clear, simple choices. Fixed rates give you peace of mind and stability. Floating rates give you the chance to save more when market conditions are in your favor.
In 2025, with repo rates steady and interest rates looking stable, both options are worth considering. The key is to look at your own financial situation, goals, and how much risk you are comfortable with.
If you are still unsure, reach out to BigMudra’s team. We will help you understand what works best for your dream home.
Need Help?
Talk to our loan experts at BigMudra today.
We will explain everything in simple words and help you choose the perfect plan.