Home Loan in Pakistan 2026: Bank Home Loan Rates and Terms Compared

In short

Pricing: most banks charge one-year KIBOR plus 2% to 4.25%, repriced yearly. MCB uses six-month KIBOR. KIBOR on 3 November 2026: 13.03% offer for one year (SBP). SBP raised the policy rate by 50 basis points to 12% on 26 October. Down payment: banks typically finance 70% to 85% of the property value, so expect to pay 15% to 30% yourself. Tenure: up to 25 years at most banks. The SBP ceiling is 30 years. Example: a Rs10 million loan over 20 years at about 16% (KIBOR + 3%) works out to roughly Rs139,400 a month. Subsidised alternative: the Apna Ghar scheme charges a fixed 5% for the first 10 years on loans up to Rs10 million.

Getting a home loan in Pakistan means borrowing at a floating rate set as KIBOR plus the bank's margin, so what you pay moves with interest rates. On 3 November 2026, the State Bank of Pakistan (SBP) published one-year KIBOR at 13.03% (offer), a week after it raised the policy rate to 12%. Most banks add 2% to 4.25% on top. This guide compares the published terms of nine banks, shows what a Rs10 million loan costs a month at today's rates, and explains the SBP limits every bank must follow. To try your own numbers, use our home loan calculator.

How bank home loans are priced

Banks quote a spread over KIBOR, the Karachi Inter-Bank Offered Rate. SBP's KIBOR sheet for 3 November 2026 shows:

So "1-year KIBOR + 3%" was about 16% at the 3 November offer rate. Banks reprice yearly on the loan anniversary, so your rate changes as KIBOR does.

On 26 October 2026, SBP's Monetary Policy Committee raised the policy rate by 50 basis points to 12%, by a majority of nine of ten members, with effect from 27 October (SBP's statement). Between 19 October and 3 November, one-year KIBOR, which most home loans are priced on, rose from 12.78% to 13.03% (offer), and six-month KIBOR from 12.44% to 12.67% (SBP). At one-year KIBOR plus 3% over 20 years, that adds about Rs1,870 a month to a Rs10 million loan.

Banks compared

Published terms on each bank's own website (BankIslami's from its key fact statement), checked 4 November 2026:

Notes:

• Meezan fixes the rate for the first year, then reprices it yearly on 12-month KIBOR, with a floor of 8% and a cap of 30%. It lists a processing charge of PKR 10,000 plus 16% FED.
• MCB gives a lower spread for a bigger down payment: 6-month KIBOR + 3% under 30% equity, + 2.5% from 30%, and + 2% from 50%, for salaried borrowers.
• BankIslami's key fact statement gives a "Rental Rate 12.99% fixed for first 3 years", then KIBOR + 3%, repriced each year on one-year KIBOR. Its product page charges 5% if the financing is settled in the first year and nothing after.
• JS Bank also lists a "Fixed Markup of 12.49% (Up to 3 years)", with an asterisk its page doesn't explain.
• UBL doesn't name the KIBOR tenor next to its rates.
• Bank AL Habib publishes its pricing and a debt burden limit of "Up to DBR 50% aggregate of Net Income" on its housing finance for women page. Its general housing finance page says financing "will be based upon verified net income" and lists "No Charges for Early Settlement".
• NBP's Saibaan page carries no date other than a 2018 copyright line, so confirm its pricing with the bank.
• The others refer to their schedule of charges for fees. We couldn't read Faysal Bank's Faysal Islami Home Finance page on 4 November (a bot check stopped us), and Askari Bank's Home Finance link led back to its home page, so they are not in the table.

What a Rs10 million loan costs a month

These are standard annuity instalments (our calculation) for a Rs10 million loan, at rates around KIBOR plus 2% to 4%:

At 16.03% over 20 years, total interest comes to about Rs2.3 crore, more than double the amount borrowed. A longer tenure lowers the instalment but adds a lot of interest. Because the rate floats, these figures change each year when KIBOR changes.

Rates as of November 2026.

The SBP limits every bank follows

SBP's Housing Finance Prudential Regulations (updated 18 August 2026):

• Tenure: "The maximum tenor for housing finance shall be thirty (30) years."
• Loan-to-value: "The maximum Loan-to-Value (LTV) ratio for housing finance shall be 90:10."
• Affordability: total monthly instalments on all your consumer loans "shall not exceed sixty-five per cent (65%) of the net disposable income."

Banks can be stricter, and most are: their own financing ratios (70% to 85%) are below the 90% ceiling. In October, SBP also limited the property documents banks can ask for. See SBP's home loan documents rule.

Bank loan or Apna Ghar?

The government's Apna Ghar scheme charges a flat 5% on loans up to Rs10 million, and UBL's scheme page says that "for a period exceeding 10 years", bank pricing applies. It is for first-time home owners. If you qualify and the amount is enough, it is far cheaper in the early years than market pricing. See our Apna Ghar scheme guide and how to apply online.

Before you apply

1. Compare like with like: the same KIBOR (1-year vs 6-month), the same down payment and the same tenure.
2. Ask for the full schedule of charges: processing, appraisal, legal, insurance and early repayment.
3. Work out your instalment with a few rate scenarios, not just today's rate.
4. Check your debt burden: all loan instalments together must fit within the bank's limit.
5. Get the property papers in order before you apply.

For city guides, see Lahore, Karachi and Islamabad.

Frequently asked questions

What is the home loan interest rate in Pakistan in 2026?

Most banks charge one-year KIBOR plus 2% to 4.25%. With one-year KIBOR at 13.03% (offer) on 3 November 2026, that is roughly 15% to 17.3%. SBP raised its policy rate to 12% on 26 October.

How much down payment do I need for a home loan?

Typically 15% to 30%, because banks finance 70% to 85% of the property value. SBP's ceiling is 90%.

What is the maximum tenure for a home loan in Pakistan?

SBP allows up to 30 years. Most banks offer up to 25 years.

What is the monthly instalment on a Rs10 million home loan?

At about 16% over 20 years, roughly Rs139,400 a month. Over 15 years, about Rs147,100.

Is Apna Ghar cheaper than a bank home loan?

For eligible first homes, yes, in the first 10 years: it is fixed at 5% on loans up to Rs10 million, compared with roughly 15% to 17.3% at market pricing.

Sources

1. SBP: KIBOR rates (as on 3 November 2026) sbp.org.pk
2. SBP: KIBOR rates (as on 19 October 2026) sbp.org.pk
3. SBP: Monetary Policy Statement (26 October 2026) sbp.org.pk
4. Dawn: Central bank raises policy rate by 50 basis points to 12pc (26 October 2026) dawn.com
5. SBP: Housing Finance Prudential Regulations 2026 (updated 18 August 2026) sbp.org.pk
6. HBL: HBL Islamic HomeFinance hbl.com
7. Meezan Bank: Easy Home meezanbank.com
8. Bank Alfalah: Home Finance bankalfalah.com
9. UBL: UBL Address Home Loan ubldigital.com
10. MCB: MCB Home Loan mcb.com.pk
11. JS Bank: JS GharApna Home Finance jsbl.com
12. BankIslami: MUSKUN Home Financing bankislami.com.pk
13. BankIslami: MUSKUN Home Finance Key Fact Statement (checked 4 November 2026) bankislami.com.pk
14. NBP: Saibaan product features (checked 4 November 2026) nbp.com.pk
15. UBL Ameen: Ghar Ho Tu Apna (subsidised scheme terms) ubldigital.com
16. Bank AL Habib: Housing Finance features bankalhabib.com
17. Bank AL Habib: Housing Finance for women (pricing and debt burden ratio, checked 4 November 2026) bankalhabib.com