Each bank’s website tells you about its own home loan and nobody else’s. That makes it hard to compare, and with a home loan the differences are not small. Over 20 years, a gap of just two percentage points can mean paying more than Rs 25 lakh extra for the same house.
So we took one house and financed it at eight banks, using the same down payment and the same term. Here is what we found.
The example we used
A house worth Rs 1 crore. You put down Rs 25 lakh, which is 25 percent, and the bank finances the remaining Rs 75 lakh over 20 years. The rates come from our September 2026 rate sheet and are the starting rates each bank advertises.
The comparison
| Bank and product | Rate | Monthly installment | Total paid over 20 years | Salary needed (50% DBR) |
|---|---|---|---|---|
| HBFC Ghar scheme | 10.75% | Rs 76,142 | Rs 1.83 crore | Rs 1.52 lakh |
| Meezan Easy Home (Islamic) | 12.65% | Rs 86,005 | Rs 2.06 crore | Rs 1.72 lakh |
| Bank of Punjab (conventional) | 14.60% | Rs 96,550 | Rs 2.32 crore | Rs 1.93 lakh |
| Faysal Bank (Islamic) | 14.90% | Rs 98,206 | Rs 2.36 crore | Rs 1.96 lakh |
| HBL (conventional) | 15.10% | Rs 99,314 | Rs 2.38 crore | Rs 1.99 lakh |
| HBL (Islamic) | 15.15% | Rs 99,591 | Rs 2.39 crore | Rs 1.99 lakh |
| MCB (conventional) | 15.35% | Rs 100,704 | Rs 2.42 crore | Rs 2.01 lakh |
| Bank AL Habib | 15.65% | Rs 102,380 | Rs 2.46 crore | Rs 2.05 lakh |
The spread is bigger than most people expect. Between the most expensive bank in this list and Meezan, the difference is about Rs 16,400 a month, and roughly Rs 39 lakh over the full 20 years.
Why HBFC is so much cheaper, and the catch
HBFC is the government owned House Building Finance Company, and its Ghar Pakistan scheme is subsidised. That is why its rate is so low. The catch is eligibility. Schemes like this are usually meant for first time buyers and come with limits on the loan size and the type of property. If you qualify, it is very hard to beat. Check HBFC’s current scheme terms directly, because they are set by the government and change more often than bank rates.
Why Meezan’s rate looks low, and what happens after year three
Meezan’s Easy Home rate of 12.65 percent is fixed for the first three years. After that, it moves with KIBOR, the benchmark rate banks use to price loans.
We ran a scenario where the rate rises to 14.65 percent from year four onwards. In that case the installment goes from Rs 86,005 to about Rs 95,900 a month for the remaining 17 years. That is still competitive, but it is a different number from the one you see on day one. Ask any bank you speak to whether the rate is fixed, for how long, and how it is reset afterwards.
What a two percent rise does to a variable rate loan
Most home loans in Pakistan are reset once a year based on KIBOR. Taking HBL’s Islamic rate as an example, if the rate rose by two percent after the first year, the installment would go from Rs 99,591 to about Rs 110,600 a month. That is an extra Rs 11,000 every month, without anything changing in your life.
This is the single most important thing to plan for with a home loan. If the installment only just fits your budget at today’s rate, it will not fit after a rate rise. Leave yourself room.
Costs beyond the installment
Every bank charges something upfront. You will pay for a property valuation by the bank’s approved valuer and a legal opinion on the property title by its approved lawyer. There is a processing fee, which in our data ranges from about 0.4 percent at Meezan to around 1.25 percent at Dubai Islamic Bank. There is also yearly property takaful or insurance.
Together these can add up to a few lakh rupees on a Rs 75 lakh loan, so include them in your planning alongside the down payment.
So which home loan is best?
If you qualify for HBFC’s scheme, start there. If you do not, Meezan’s fixed first three years make it one of the most predictable options available right now, especially if you expect rates to move. Among conventional loans, Bank of Punjab was the lowest in our comparison.
The bank with the lowest headline rate is not always the cheapest overall, so compare three things together: the rate, how and when it can change, and the total fees.
Compare your own home loan
Our Home Loan Calculator compares 11 banks at once for your property price, down payment and salary, shows your DBR, and includes a rate rise scenario so you can see what a higher KIBOR would do to your installment.
Not sure how much your salary supports? Our guide on how much salary you need for a loan has a ready made table.
Rates were checked in September 2026 and are the starting rates banks advertise. Your actual rate depends on your profile and the bank’s offer at the time you apply, so the written offer is always the final word.
Work out your home loan
- Home Loan in Pakistan 2026: How It Works From Application to Keys
- Government Home Loan Schemes in Pakistan 2026: How to Use Them to Buy or Build a House
- HBL Home Loan Calculator
- Mera Ghar Mera Ashiana Calculator