A bank house loan in Pakistan is normally priced at 1-year KIBOR plus a spread, about 3% for salaried people and 4% for businessmen at the banks that publish it. Terms run up to 25 years and you pay roughly 20% to 30% of the price yourself. If you are a first-time home owner, the government-backed PM house loan is cheaper: up to Rs10 million at a fixed 5% for 10 years. Figures below were read from bank pages on 28 October 2026.
Bank House Loan in Pakistan: Quick Facts
| Detail | Information |
|---|---|
| Pricing basis | KIBOR plus a spread. Most banks that publish it reprice once a year |
| Typical spread (published) | 1-year KIBOR + 3% salaried, + 4% self-employed or business (Alfalah, Meezan, HBL Islamic base case) |
| Typical tenure | 3 to 25 years for purchase; renovation is shorter |
| Your own share | About 20% to 30% of the property value at most banks |
| Minimum salaried income (Meezan) | Rs50,000 gross a month |
| SBP policy rate | 11.5%, unchanged on 14 September 2026 (ARY News) |
| Cheaper option | Wazir-e-Azam Apna Ghar Program: 5% fixed for 10 years, up to Rs10 million |
| Where to compare | Each bank's Key Fact Statement (KFS), plus our loan calculator |
How Bank Home Financing Works in Pakistan
A home loan (house qarza) lets you buy a house, build on your plot, buy a plot and build, or renovate. You pay part of the price. The bank pays the rest and keeps the property as security until you finish repaying.
Banks lend against your income, not only the property. They check your salary or business income, other loans, credit history (CIB report) and the property title and valuation. Then they set a monthly instalment (kist).
The rate: KIBOR plus spread
KIBOR is the Karachi Interbank Offered Rate. It moves with the State Bank of Pakistan (SBP) policy rate and the market. The bank adds its own spread on top. For example, "1-year KIBOR + 3%" means you pay the 1-year KIBOR level on the pricing date plus 3 percentage points.
The SBP Monetary Policy Committee held the policy rate at 11.5% on 14 September 2026 (a newer decision was due on 26 October 2026), as reported by ARY News. KIBOR changes daily, so no KIBOR figure is quoted here. Check the current 6-month and 1-year KIBOR and any newer policy decision on sbp.org.pk before you calculate.
Variable versus fixed
Most home loans are variable. Your rate resets, usually once a year, so your kist can rise or fall. HBL's Islamic page says a fixed profit rate may be offered at the bank's discretion. Always ask what happens at repricing.
Conventional vs Islamic Home Finance (Diminishing Musharakah)
Pakistan has both. Conventional banks lend money and charge markup. Islamic banks use Diminishing Musharakah: you and the bank co-own the house. You pay monthly rent for the bank's share plus a payment that buys part of that share. Your ownership rises each month until you own the whole property.
- Same benchmark: Islamic products are also priced off KIBOR, so monthly costs look similar.
- Different contract: the bank is a co-owner, not a lender. This is why Meezan Easy Home, HBL Islamic HomeFinance and Alfalah Home Musharakah are offered as Shariah-compliant.
- Not automatically cheaper: choose it for your beliefs, then compare the actual quote.
- Takaful and insurance: expect property insurance or takaful in both types.
Bank Home Loans Compared (Read on 28 October 2026)
The table uses each bank's own product page. Where a page does not publish a figure, the cell says so. Banks change terms often, so treat this as a starting point and confirm with the bank.
| Bank and product | Maximum amount | Tenure | Pricing basis | Your share / bank finances |
|---|---|---|---|---|
| Meezan Bank Easy Home (Islamic) | Rs1m to Rs100m (Easy Buyer); renovation up to Rs20m | 3 to 25 years | 1-year KIBOR + 3% salaried, + 4% businessmen; floor 8%, cap 30% | Bank up to 75% (salaried), 70% (businessmen) |
| HBL Islamic HomeFinance | Rs2m to Rs100m | 3 to 25 years | 1-year KIBOR + 3% to 4.2% by customer type; fixed rate possible at bank discretion | Up to 70% of value |
| Bank Alfalah Home Finance | No fixed maximum stated; set by credit policy | 3 to 25 years | 1-year KIBOR + 3% salaried, + 4% businessmen or NRP; 6-month KIBOR optional | Up to 80% for purchase; at least 20% equity |
| MCB Home Loan | Up to Rs50m "or even higher" | 2 to 25 years | 6-month KIBOR + 2% to 3% salaried, + 2.5% to 3.5% self-employed (lower spread with more equity) | Spread tiers: equity below 30%, 30% to 50%, 50%+ |
| Allied Bank Home Finance | Rs75m (renovation Rs15m) | 3 to 25 years (renovation 10) | 1-year KIBOR + up to 4%; the page also lists a range of +1.75% to +5% | 25% equity (purchase), 30% (land and build) |
| BankIslami MUSKUN (Islamic) | Rs200,000 to Rs150m (renovation up to Rs10m) | 2 to 25 years | Rate not published on the product page | Bank up to 75% |
| UBL Address / Ameen Address | Islamic: Rs1m to Rs50m in the KFS; conventional maximum not confirmed | Pages conflict: 3 to 20 years, and 25 years for purchase in one FAQ | KIBOR + 3.5% salaried, + 4% self-employed (undated page) | Not confirmed |
| BOP Apna Ghar house loan | Not confirmed | BOP documents conflict: 20 years in FAQs, 25 years on one scheme page | BOP says to check its website or a branch for rates; no rate confirmed | Not confirmed |
| HBFC Ghar Sahulat Scheme | Up to Rs30m | 3 to 20 years | 5-year PKRV + 4% for 5 years, then 5-year PKRV or 1-year KIBOR + 4% | HBFC finances up to 85% |
Sources and dates. Each row was read from the bank's own product page on 28 October 2026: Meezan, HBL Islamic, Bank Alfalah, MCB, Allied Bank, BankIslami and HBFC. The pages carry no revision date, so the date we checked them (28 October 2026) is the only date we can give. UBL and BOP publish documents that disagree with each other and are undated, so I left their amounts and rates as "not confirmed" instead of guessing.
These are published ranges, not an offer. Your actual spread, limit and fees depend on your employer, income, city and property. Ask for the bank's written Key Fact Statement (KFS) and quote.
Meezan Easy Home: key points
People search "Meezan loan" for this product. Easy Home covers buying (Easy Buyer), building (Easy Builder), renovating, replacing an existing financing and enhancing. Meezan's page states a minimum gross income of Rs50,000 a month for salaried and self-employed professionals and Rs100,000 for businessmen. Salaried applicants need two years of continuous history in the same industry; businessmen need three years in the current business. The page is inconsistent on businessmen's financing share (70% in one place, 65% and 75% in the FAQ), so ask Meezan for the exact ratio.
HBL, HBFC and BOP: what to know
HBL home loan: HBL publishes its Islamic home finance terms: Rs2m to Rs100m over 3 to 25 years. HBL's conventional HomeLoan page was not available, so we do not quote conventional HBL figures. Ask your branch for both.
HBFC loan: House Building Finance Company is the state-owned housing lender. Its Ghar Sahulat Scheme page shows up to Rs30m, 3 to 20 years and an 85% financing share, with a minimum age of 23 and maximum of 60 at maturity. HBFC also takes part in the PM house loan. Its site lists the helpline 0800-42325.
BOP house loan: Bank of Punjab runs an Apna Ghar house loan. Because its documents disagree on tenure and no rate is published, call a BOP branch for current numbers.
The Cheaper Option: PM House Loan (Mera Ghar Mera Ashiana Banks)
If you do not own a house, check the federal scheme before a normal bank loan. It was launched as Mera Ghar Mera Ashiana and renamed Wazir-e-Azam Apna Ghar Program (Ghar Ho Tu Apna). As of 28 October 2026, it offers up to Rs10 million at a fixed 5% for the first 10 years, repaid over up to 20 years, with a 10% down payment. After year 10 the rate becomes market-linked.
Many of the banks in the table above lend under it, including Meezan, HBL, Allied, MCB, UBL, Alfalah, BankIslami and HBFC. This page does not repeat the details. Read Mera Ghar Mera Ashiana for old versus new terms, Shahbaz Sharif loan scheme for the federal loan list, and PM Apna Ghar Programme for the application steps. Bank employees cannot use the scheme.
| Feature | Normal bank home loan | PM house loan |
|---|---|---|
| Rate | KIBOR + spread, variable | 5% fixed for 10 years |
| Who | Anyone who meets the bank's credit rules | First-time home owners with a CNIC (NICOP or POC for overseas) |
| Your share | About 20% to 30% | 10% |
| Maximum | Rs30m to Rs150m depending on the bank | Rs10 million |
| Property | Set by the bank | House up to 10 marla or flat up to 1,500 sq ft |
Own a house already, or need a larger loan? A normal bank loan is the route. In Punjab, also look at Apni Chhat Apna Ghar and Punjab CM loan schemes.
Eligibility and Documents
Common eligibility rules
- Pakistani citizen with a valid CNIC (overseas Pakistanis use NICOP or POC at some banks).
- Age: usually 21 to 25 at the start and 60 to 65 at the end of the loan, depending on the bank.
- Stable income: Meezan asks two years of employment for salaried and three years of business for self-employed. HBFC asks one to four years by employment type.
- A clean credit record and manageable existing debt.
- A property with a clear title that the bank can value.
Documents banks usually ask for
- CNIC copies of the applicant and any co-applicant.
- Salary slips and bank statements (salaried), or business bank statements and tax or business proof (self-employed).
- Employment or experience letter.
- Property papers: sale agreement, title, fard or registry, and an approved map for construction loans.
- Recent photographs and the signed bank application form.
The exact list differs by bank, so ask for the checklist first. For the PM house loan, see our documents checklist.
How to Apply for a Bank House Loan: Step by Step
- Set your budget. Work out the property price, your own share and the largest kist you can pay each month.
- Estimate the instalment. Use the loan calculator with different tenures.
- Check the PM house loan. If you are a first-time owner, apply at apnaghar.gov.pk or a participating bank.
- Ask three banks for quotes. Get spread, fees, equity and repricing rules in writing.
- Apply with documents. Submit the form and papers at a branch or through the bank's online home finance form.
- Valuation and legal check. The bank sends a valuator and lawyer to the property. You normally pay these fees.
- Approval and offer. Read the Key Fact Statement before you sign.
- Sign and disburse. The property is mortgaged or co-owned with the bank, and the bank pays the seller.
How to Compare Bank Home Loans
- Spread, not the headline. A lower spread over the same KIBOR is the cleanest comparison. Check whether the bank uses 6-month or 1-year KIBOR.
- Floor and cap. Meezan lists an 8% floor and a 30% cap. Ask each bank for its own.
- Equity. MCB lowers the spread as your equity rises, so a bigger down payment can cut the rate.
- Fees. Ask about processing, valuation, legal, insurance or takaful, and prepayment charges. BankIslami lists a 5% prepayment charge in the first year.
- Repricing date. Know when your rate resets.
- Total cost. Ask for the full repayment schedule, not only the first kist.
Common Reasons a House Loan Is Rejected
- Income too low or hard to prove, such as cash earnings with no bank trail.
- Too many existing loans or credit cards. Banks cap total repayments against income.
- Late payments on your CIB (credit) report.
- Short job history, or a business under the minimum years.
- Property with unclear title, a disputed plot, or one in an unapproved society.
- Valuation lower than the price you agreed.
- Missing, mismatched or expired documents.
If rejected, ask the bank for the reason. Fix it, add a co-applicant from the immediate family where allowed, or try another bank with different rules.
More Housing Help on This Site
Use our loan calculator, check helpline numbers, and see Apna Ghar in Sindh and KP. Beware of fake loan offers: pay no fee to an "agent" and apply only through a bank branch or official portal.
Frequently Asked Questions
There is no single best bank. Most banks price at 1-year KIBOR plus a spread of about 3% for salaried people and 4% for businessmen, so your profile and the written quote matter more than the brand. Compare at least three banks on spread, fees, equity and repricing rules. The PM house loan at a fixed 5% for 10 years is cheaper if you qualify.
It depends on the bank and your income. Published product pages show up to Rs100 million at Meezan Easy Home and HBL Islamic HomeFinance, Rs150 million at BankIslami MUSKUN, Rs75 million at Allied Bank and up to Rs50 million or higher at MCB. The bank only lends what your income can support.
Most banks offer 3 to 25 years for buying a house. Meezan, HBL Islamic, Bank Alfalah, Allied, BankIslami and MCB publish up to 25 years. HBFC's Ghar Sahulat Scheme page shows 3 to 20 years. Renovation loans are shorter, often up to 10 years.
Usually 20% to 30% of the property value. Meezan lends up to 75% for salaried applicants, Bank Alfalah up to 80%, Allied Bank asks for 25% equity on purchase, HBL Islamic finances up to 70% and HBFC up to 85%. The PM house loan needs only 10%.
Easy Home is Meezan Bank's Islamic home financing based on Diminishing Musharakah. The bank and you co-own the property, you pay rent plus a share purchase each month, and your ownership grows until you own it fully. Pricing is linked to KIBOR.
It is structured differently from a loan, because the bank co-owns the property and charges rent instead of interest. But the rent is benchmarked to KIBOR, so the monthly cost looks similar to a conventional loan. Choose it for religious reasons, not because it is automatically cheaper.
KIBOR is the Karachi Interbank Offered Rate, a market benchmark published by the State Bank of Pakistan. Banks add a spread to it. When KIBOR rises or falls, your rate changes at the next repricing date, usually once a year.
The latest confirmed decision is 11.5 percent, held by the SBP Monetary Policy Committee on 14 September 2026 (a newer decision was due on 26 October 2026), as reported by ARY News. Check sbp.org.pk for any newer decision.
Banks set minimum income. Meezan Easy Home asks Rs50,000 gross a month for salaried applicants and Rs100,000 for businessmen. The PM house loan scheme lists lower minimums at some banks, such as Rs40,000 at Meezan, so low-income families should check it first.
The federal Wazir-e-Azam Apna Ghar Program (formerly Mera Ghar Mera Ashiana): up to Rs10 million at a fixed 5% for the first 10 years, with 10% down payment, for first-time home owners. Normal bank home loans cost KIBOR plus a spread.
Common reasons are low or unproven income, a high existing debt burden, a poor credit report (CIB), unclear property title, a property the bank cannot value, and missing documents. Fix these before applying.
Yes. Use our loan calculator to estimate monthly instalments, then confirm the exact figure in the bank's Key Fact Statement.
Disclaimer: Apna Ghar Guide is an independent information site, not a government website or a bank. Always apply through official portals and bank branches. Information verified on 28 October 2026 from the product pages of Meezan Bank, HBL Islamic, Bank Alfalah, MCB, Allied Bank, BankIslami and HBFC, from undated UBL and BOP documents, from the SBP policy rate as reported by ARY News on 14 September 2026, and from our Mera Ghar Mera Ashiana page. Bank terms change often; confirm with the bank.