5 Interesting Ways To Bring Down Electricity Bill During Summers

Every year as the summers approach, temperatures soar and so do the electricity bills alongside. The air conditioners working day in and out and electricity metres running a marathon, and here we are looking for ways to save energy and bring down the bills. Tried many tricks but none worked? MakaaniQ gives five interesting ideas you could use to save on your electricity bills:

 Use appliances in off-peak hours

It is said that appliances discharge heat when in use, especially the big ones including washing machines, dryers and dishwashers. Use such appliances during the night when the temperature is not as high as it is during the day. The heat these appliances would emit will not take the indoor temperatures up hence, keeping you away from pulling up your air conditioners. Moreover, while using these appliances in the night you will also not feel the heat so much.

Clean up the air conditioner

This is one of the first steps when opening your air conditioner back for use in summers. Call the servicing team, clean up the air conditioner and change the filters if required, to enhance efficiency. Dirt accumulated in the air conditioner can be a cause of the appliance to work full throttle but not provide enough cooling. Moreover, it also spreads the dust indoors, becoming a cause of allergies.

Seal it in

To further make air conditioners more effective, especially if it is a window one, seal the corners of the window where it is installed. This will allow the air to flow in the room and not discharge to the outdoors through small openings at the side of the air conditioner.

Close the windows and vents

Try to keep the windows and doors of the room you are sitting in, closed. This will help you keep the cool air intact in the room and thus, switch off the air conditioner once it is cool enough. Open doors and windows let the air flow to rooms where it is not required and keeps you away from it.

Window treatments

Window treatments can also help keep the cool air intact. Heat from the outdoors can subside the cooling provided by your air conditioner. Curtains, outdoor chicks and blinds can be some of the options you could try. Ensure that these are dark in colour thus, absorbing heat and not letting it spread indoors.

Also Read: 8 Ways To Keep Your House Cool This Summer

Vastu Tips To Set Up A Living Room

Vastu, the ancient art that is widely followed in the world of architecture, specifies the manner in particular parts of housing units must be constructed. In this article, we talk about how to build a Vastu-compliant living room.

Direction: If your house faces the north or the south direction, the living room must be constructed in the northeast direction. In a west-facing house, the right direction for building the living room is the northwest side while the southeast direction is considered apt for a south-facing unit.

Also read: Home Sutra: Vastu Tips For Keeping Construction Material

Accessories: There are various things that we place in the living room and each of these things has to be kept in a certain way to ensure better flow of energy in the area. 

  • The telephone should be kept in the southwest direction.
  • Electrical appliances such as the cooler or the air-conditioner are best placed in the west or the north corner of the room. The south-east corner is perfect for setting up the television.
  • Articles of furniture have to be placed in the south or west corners of the room. According to Vastu, the ideal shape of articles of furniture is square and rectangular.
  • North and east areas of the room are apt to place aquariums and paintings depicting water bodies.
  •  The chandelier should not be placed right at the centre. It would be more appropriate to keep it towards the west.
  •  The entry door and windows should be in the east or the north direction.

Colour scheme: The colour scheme for the living room has to be decided depending on its direction and the ruling planet of that direction. For instance, white should be the choice for a room set in the east direction, which is ruled by the Sun. However, if the room is located in the west, a direction ruled by Saturn, blue is your colour. Otherwise, light shades of yellow and green are the ideal choices for the living room. Vastu experts say red and black should be avoided in the living room.

Also read: Home Sutra: Vastu Tips For Griha Pravesh

Seating: Vastu specifies the direction facing which the members of the family should place themselves when they are in the living room. The head of the family and their spouse, for instance, is advised to sit in the southwestern corner of the living are, facing the northeast or the east. Guests should be made to sit in the southeast and the northwest direction, facing the west or the south direction.

Are You A Landlord? These Are Your Legal Rights

While we talk a lot about the rights of a tenant and how to safeguard them, there is other side of the transaction, too. A landlord. Under the rental laws in India, there are rights that safeguard the interests of a landlord, too.

The Rent Control Act is one important act passed by the Government of India in 1948, post which several states like Delhi, Maharashtra and Karnataka have undertaken modifications to the same. The act, however, seen as pro-tenant, also, talks about the protection of rights of landlords. Recently, various ammendments have taken place pertaining to new laws favouring landlords.  

Whether a first-time landlord or a seasoned renter, here’s what you should know about the basic rights of landlords:

Right to evict a tenant

With the Rent Control Act applicable only to a tenancy of over 12 months, things seemed tougher for landlords to evict tenants living in the property for years. The Draft Model Tenancy Act 2015, which has been in the news recently, aims to make things easier for landlords as well as tenants by addressing untimely eviction, repossession issues as well as mutually fixing and revising the rent. Laws now allow landlords the right to evict a tenant on the grounds of breach of rental agreement; subletting rented premises or a part of it without landlord’s permission; default in payment of rent for specified period; misuse of the property; or conducting illegal activities in the rented premises. The landlord also has a right to evict a tenant if he or she requires the building for his or her own occupation.

To prevent tenants from overstaying, landlords can also add a clause of hike in rent in the agreement, if the tenant does not leave when the contract ends.

Also read: 5 Things Landlords Should Do To Guard Their Interest

Right to temporary recovery of possession

A landlord is entitled to obtain possession of the property, in case there is a requirement for him to carry out repairs, alterations or additions to the building, which cannot be carried out without the building being vacated, after which the building will again be offered to the tenant. Or, if the rented accommodation has become unsafe for habitation and cannot be refurbished without being vacated, the landlord is entitled to get possession of the property.

Right to increase the rent

Regulations allow landlords to have an upper hand as far as the collection of rent is concerned. Owners of residential or commercial properties not only have a right to charge rent at market rates from their tenants for taking the premises but also to raise the rent periodically. The Draft Model Tenancy Act is instrumental in creating a balance by bringing the urban rented accommodations under the purview of the formal housing sector. The Act clearly specifies the period, inheritance, rents payable as well as the obligations of landlord and tenants. In India, the applicable rate of rent increase is around 10 per cent, every two years, for residential properties. But, mostly, there are laws governing this too. For instance, the landlords in Delhi can increase rent only as per Section 6 & 8A of Delhi Rent Control Act.

Also read: 5 Quick Tips To Make You A Good Landlord

To be advised of necessary repairs

It is the duty and the right of the landlord to respond to the requests for repairs in a reasonable amount of time. Minor repairs of the property could be undertaken by the tenant. However, for all major repairs requiring reimbursement, prior permission needs to be taken from the landlord in writing. So, a landlord has the right to be informed about necessary repairs being made to his or her property. As per law, the landlord is under obligation to keep the property in good and tenantable form. But the rent control act provides the provision for both parties to share the financial burden of the repairs.

What Category Of Borrower Are You?

We all have different temperaments. Each one of us, as a result of this, handles our debt differently. Before we think of applying for a home loan, we must have a clear understanding about what sort of borrower we are going to be. We may have to make certain behavioural changes accordingly to make the most of the opportunity banks provide us in the form of loans. Well, they do charge you an interest, but they also help you own a property much sooner than you actually could if you were to rely on your own self to make the purchase.

You treat it as a necessary evil

Given a choice, you would not take a loan, ever. Your parents saved their entire lives and managed to buy a home in the dusk years of their life, using their own money. No bank assistance was needed. They may have suffered the obvious pains of opting for rental living spaces, but they did not have the sword of equated monthly installment (EMI) hanging over their heads. From where you see it, that is the best approach. You, on the other hand, do not have a choice but to apply for a home loan. No matter how much you saved, you may not be able to have enough savings to buy a house even after retirement, considering prices have skyrocketed since your parents became property owners. There is also that societal pressure on you to have a home as soon as you can. A borrower with this tendency would most certainly linger before applying for a loan, and will always be in a hurry to get rid of the burden as soon as he can without giving much thought to the advantages or the disadvantages of making hurried moves. Understandably, you may end up suffering losses in your pursuit to stay debt free.

Do note: Banks may take a little while to warm up to you because you may not have a credit history.

You cannot stop reacting

Some of us are over-eager by nature. This would reflect clearly in our borrowing behaviour. You are driven to make a quick jump as soon as you read about rate reductions. You may forget that rate reductions would work well for you only if your current financial position is strong. Once you have taken a loan and are servicing it, you would keep your eyes wide open and switch your loan to another bank if they offer you lower rates. Even at the risk of upsetting your current lender, who may be willing to offer you a similar deal, you exit in a hurry. Much to your dismay, your previous lender decided to reduce rates the very next month. While your loan is linked to a floating rate of interest, you realise the many benefits of having it linked with at a fixed rate. Quickly, you get that alteration done.

Do note: Your swift moves may upset banks. Not to mention the fact that you may also lose money if you decide not to stay put even for a second.

Someone else did it for you

You like others to make your decisions for you, and then you blame them if things do not go as well as you like them to go. So, it was your parents and wife who convinced you to apply for s loan. Because you are going to pay the EMI, you start cribbing about it. Because you do not like to take the matters directly in your own hands, you would keep on paying the EMI without even trying to find ways to reduce the burden. Unless your parents and wife can save enough money and convince you to pre-pay your loan, you will continue living miserably.

Do note: In your inert state, you in all likelihood would lose out on all the new offers that banks keep coming up with.

You know what you are doing

Believe it or not, not many borrowers fall in this category. While many loan seekers enter the world of borrowing unarmed, others understand only parts of the process. These types of borrowers either start by opting for the wrong plan or keep doing wrong in other various ways. Not so with the kind of borrowers we are going to talk about here. This sort knows that it requires a home loan. It would help in several ways. Apart from the obvious benefit of owning a home, this borrower also knows all about the tax rebates he would enjoy. It would only be after saving enough money to make a substantial down-payment that this borrower would approach banks. In the meantime, he would do his research about products and their merits. He would decide to switch his lender or pre-pay his loan only after doing all the calculations.

Do note: Banks cannot baffle this category of borrower; they dazzle them instead.

Documents That Ensure A Property Transaction Is Complete

A property transaction is successfully completed only when the paper work is done in a right manner. At the end of the process, you should have all the document to prove your ownership.

Here is a list of must-have property documents when you ink the deal:

Mother deed or sale deed

This is the most important legal document, which is the proof that the property was transferred from the former owner and the current owner. It also includes the terms and conditions of the sale and executed after the sale agreement. However, it has to be registered within four months of the sale, without which a penalty is levied.

Khata certificate & extracts

This certificate is known by many names across various states. It is an entry in the local municipality, confirming an account or khata in the said name. This is obtained after paying the tax.

Allotment letter & possession letter

An allotment letter is given by the developer or the co-operative society after the completion of the home purchase. A possession letter also lists the date of expected delivery of the home by the developer. This document is required to obtain a home loan.

Receipts of payment to developer

A home buyer should always collect receipts of payments to the developer. This should state the down-payment amount paid and other charges, if any. It is an important evidence and is necessary for loan processing.

Latest tax receipt of property

The latest tax receipt of the property is important to ascertain many details like the owner of the property.

Encumbrance certificate

This certificate can be obtained from the sub-registrar’s office. It tells if there has been any transactions or mortgages on the property.

Construction plan & sanctioned layout plan

The developer should have an approved construction plan. It should have to be approved by the local authorities. The developer should also be able to produce sanctioned building plan with all the necessary permissions in place for the construction of a property to begin.

3 Signs That Will Help You Identify A Property Scam

An advertisement stating that a 2BHK apartment is up for grabs in Delhi’s Lajpat Nagar for Rs 8.99 lakh is surely going to give you a happy shock. But, it is here that you have to exercise extreme caution. Advertisements and offers are often impregnated with scams and as a buyer you have to act with prudence and vigilance. If you are looking with care, you would find the obvious red flags.

Too-good-to-be-true deals

An innate characteristic of a fraud is the promise of unrealistic returns. Instead of getting excited about it, one has to be more watchful. As in the case of investments, deals offering quick, hefty and easy returns should be taken with a pinch of salt.

Seller is in a tearing hurry

If your seller is in a hurry to close the deal, there is a need to be vigilant. Any fraudster, who has the intention to cheat you will show an urgency to sell the property, and will insist you to make the down payment right away. Many even offer a price that is below the market rate. Victims are often warned of dire consequences or the loss of the good deal if they don’t act right away.

No clarity on documentation

In a normal transaction, one has to engage in a rigorous documentation process to make provide the transaction legal validity. Conmen often insist on payment of money before you sign on the legal documents, taking the plea that paperwork would take its own course. It is important to rightly establish the credentials of the seller and that can happen only if you insist on paperwork. One should also check if the property is mortgaged. If the seller is apprehensive in showing you the property papers, it means something is amiss. A close scrutiny of papers, including approvals from the local authority, registration certificates, etc., will help you establish if the seller has a checkered past or not.

Tips For Buyers If The Seller Is Still Re-Paying The Home Loan

If you are buying a resale property, chances are the current owner is still servicing his home loan. If that is the case, what could be the implications for you as a buyer?

First and foremost, the purchase process might take slightly longer than usual. The seller will have to pre-pay his loan and get the original documents released from his lender. After the seller pays his outstanding loan, the bank would take at least 10 days to issue a no-dues certificate along with all other property documents. In case you are using home finance to buy this property, the process might take even longer.

Why is that?

Since the seller has taken a home loan, all key documents of property are lying with the bank. The seller would only be able to produce photocopies of these documents for your perusal. In your best interest, do ask the seller to show a letter from his lender which states that he is the owner of the property against which he is servicing the home loan.

In case you are applying for a home loan to buy this property, you could go with the same lender as your seller. This would be less time taking and more convenient for you. How? The seller could help you get a better deal from the banks since he is an old customer. Also, since the bank already knows the property, it only has to know about your income and repayment capability to grant the loan. However, these should not be the only deciding factors when you take a home loan. If another lender is offering you a loan at a cheaper rate, apply for a loan there by all means.  The idea must be to save money.

How The Actual Value Of Your House Is Determined

Sure, you invested in another property to earn more money. But, similar to your other incomes, the money you earn as rent would be subject to taxes, depending on the actual value of the property. Mind you, even if your property is not let out for a part during a year, you will have to pay taxes based on the notional rent receivable. But how does one arrive at the actual value of a property?

According to Section 23(1)(a) of the Income Tax (I-T) Act, the annual value of your property is the amount it is expected to earn you when let-out from year-to-year.  Based on four factors, the annual value of a property is arrived at.

Municipal value

For the purpose of charging local taxes, municipal bodies evaluate your property.  While assigning a value to your property, municipalities take into account a lot of factors. These include the location, the size, the amenities, etc. For instance, a 1BHK apartment in a housing society that is close to the city is expected to fetch more rent than a similar unit in the suburb.

Actual rent received or receivable

This is the amount you receive from your tenant on an annual basis. However, your actual income would be calculated on the basis of who pays the utility bills of the rented unit.

Fair rent

You might be getting less in rent for your property than others who have rented out similar properties in the same area. This means you are not earning what is known as “fair” amount as rent. The rent that similar properties with similar amenities in similar areas earn is the fair rental value.

Standard rent

Areas where the Rent Control Act is in place, a standard rate is fixed. Landlords of such property have to stick to this amount, irrespective of the market value of their properties. For instance, properties in Delhi’s Connaught Place fetch owners meagre annual amount because buildings in the area fall under the ambit of the Rent Control Act.

Now, the annual value of your property will be the highest among these amountsthe rent received or receivable, the fair market value or the municipal valuation.

Sample this. Your municipality has valued your property at Rs 1.20 lakh annually while its fair market value is Rs 3 lakh. You, on the other hand, are earning Rs 2.80 lakh annually as the rent from the property. As the fair market value of your property is the highest amount of the three, the actual rental value of your property is Rs 3 lakh, and based on this amount you will have to pay taxes on your house property.

SBI Cuts Home Loan Rate To 6.70%

In a move that would boost the purchase of affordable properties in India, the country’s largest commercial bank, State Bank of India (SBI), has reduced its home loan interest for loans worth up to Rs 30 lakhs by 25 basis points (bps).

Effective from May 1, 2021, the state-run bank will charge only 6.70 per cent interest on home loans in this ticket size as against 6.95 per cent earlier. On home loans falling within the Rs 31 lakhs and Rs 75 lakhs bracket, SBI will charge an annual interest of 6.95 per cent. On home loans worth over Rs 75 lakhs, a borrower will have to pay an annual interest of 7.05 per cent.

SBI home loan interest rate May 2021

Ticket size

Annual interest*

Up to Rs 30 lakhs

6.70%

Between Rs 31 lakhs and Rs 75 lakhs

6.95%

Over Rs 75 lakhs

7.05%

 *Valid from May 1, 2021

 

While the bank will offer an additional rebate of five bps on interest rates for women, it will also offer a further concession of five bps if an applicant were to apply for the home loan through SBI’s YONO app. This means, a woman borrower with a good credit score, who applies for home loans at SBI through the YONO app, can claim a home loan at interest rate as low as 6.60 per cent annual interest.

Borrowers will have to pay 0.40 per cent of the loan amount as the processing fee, subject to a minimum of Rs 10,000 and the maximum of Rs 30,000, with GST (Goods and Services Tax). If a buyer is buying a property where the bank has a tie-up with the builder, he will be charged 0.40 per cent of the loan amount as the processing fee, with the upper limit set at Rs 10,000, plus applicable tax.

Recall here that SBI, in April 2021, hiked its home loan interest rates by 25 bps, fueling speculations that other banks may start implementing an increase in home loan interest rates. Even as SBI has itself rolled back the hike, no other bank has announced any increase in interest rate so far.  

 

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SBI To Charge 6.95% Interest On Home Loans

With effect from April 1, 2021, public lender State Bank of India (SBI) has increased home loans interest rates by 25 basis points (bps). With this, borrowers will now have to pay 6.95 per cent annual interest, for home loans at SBI, as against 6.70 per cent earlier.

The state-run bank has also decided to charge 0.40 per cent of the loan amount as the processing fee for loan disbursal. Till March 31, 2021, SBI was offering a complete waiver on the processing fee, apart from offering loans at lower rates.

 

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SBI Reduces Home Loan Interest Rate To 6.7%, For A Limited Period

March 10, 2021: State Bank of India (SBI) has reduced its home loan interest rates to 6.7 per cent, from the previous 6.8 per cent, effectuating a 10-basis point cut. The new rates by the public lender, are being offered for a limited period, till March 31, 2021.

For home loans of up to Rs 75 lakhs, SBI will be charging 6.7 per cent annual interest. It will charge 6.75 per cent annual interest on home loans above Rs 75 lakhs. However, SBI will offer the best rates, only to borrowers with impressive credit scores.  

 

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Delhi Cooperative Housing Finance Corporation Slashes Home Loans Rates To 6.75%

In what could further boost the buyer sentiment in the national capital, city-based Delhi Cooperative Housing Finance Corporation (DCHFC) Limited has announced a 70-basis-points reduction in its home loan interest rates, Effective from February 8, 2021, the home loans at the bank would be available for 6.75 per cent as against the earlier 7.45 per cent per annum.

Most banks have lowered their home loan interest rates to sub-seven per cent level, after the Reserve Bank of India (RBI) in May 2020 brought down the repo rate, at which it lends money to banks, to four per cent through consecutive cuts.

The reduction, the DCHFC said, would bring down the loan payment instalment from Rs 803 per lakh to Rs 760 per lakh.  The move by the bank comes, following a directive by the chief minister Arvind Kejriwal-led government to reduce interest rates, after the UT administration last week slashed the circle rates for all properties in Delhi by 20 per cent, albeit for a period of six months, till September 30, 2021.  Combined with the lowering of interest rates, this presents a unique opportunity for homebuyers of the national capital to possess a home, at a time when the DDA has also announced its housing scheme for the year 2021.

The lender is also planning to launch an attractive housing loan package for the middle-class and the weaker sections, it said in a statement issued on February 8, 2021.

State-run DCHFC provides home loans to Delhi citizens for purchase of homes in group housing societies, apart from offering loan support to those purchasing a flat from the Delhi Development Authority. Aside from offering loan swapping facilities, the corporation also grants financial assistance for home extension and house renovation, at rates much lower than those offered by private banks.

 

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SBI Pares Home Loan Interest Rate To 6.8%

January 20, 2021: With an aim to attract borrowers, public lender State Bank of India (SBI) has cut the interest rate on home loans of up to Rs 30 lakh by 10 basis points. With this, the effective interest rate on this ticket size would now be 6.8 per cent from the previous 6.9 per cent.

The bank has also implemented a five-basis-points reduction in loans of over Rs 30 lakh, which would now attract an annual interest of 6.95 per cent from the earlier 7 per cent.

The new rates are applicable from January 8, 2021.

Till March 31, 2021, the bank will also continue to offer a complete waiver on its home loan processing fee, apart from offering an additional five-basis-point waiver to women borrowers. Those applying for a balance transfer will also be offered an additional concession of five basis points.

“Home loan interest rates are linked to the CIBIL score and start from 6.80 per cent for loans up to Rs 30 lakh and 6.95 per cent for loans above Rs 30 lakh. Interest concessions up to 30 bps are also available in eight metro cities for loans up to Rs 5 crore,” SBI said, on January 8, 2021, in a statement.

Customers applying through SBI’s YONO app or its official portals, homeloans.sbi and sbiloansin59minutes.com are also being offered an additional five-bps rebate on interest rates.

“We are pleased to improve our concessions to prospective home loan customers up to March 2021. With SBI’s lowest interest on home loans, we believe this move will facilitate and encourage homebuyers to take the home buying decision with confidence. With the nation all geared up to move ahead post-pandemic, SBI would continue to support homebuyers and the real estate sector,” said CS Setty, MD (retail and digital banking), SBI.

 

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Kotak Mahindra Bank Cuts Home Loan Interest By Another 15 Bps

November 4, 2020: Days after the bank lowered its home loan interest rates by 10 basis points (bps) to bring it down to 6.9%, Kotak Mahindra Bank has announced a further 15-bps reduction in rates. With the latest cut, the private lender is now offering home loans at 6.75% annual interest.  This rate is also applicable on all balance transfers.

The best rates will, however, be available to those with good credit scores and the nature of their employment. The bank will also factor in the loan-to-value ratio, while offering concessional rates. The bank will, for instance, charge 8.45% interest on home loans to non-salaried employees where the LTV ratio ranges between 80% and 90%. On the other hand, the best rates are being offered to salaried employees where the LTV ratio is less than 80%.

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SBI Cuts Home Loan Interest Rate To 6.9%

October 22, 2020: A day after public sector bank SBI lowered lending rates to 6.9% as part of its festive offering, private lender Kotak Mahindra Bank on October 22, 2020, announced a reduction of 10 basis points to bring the interest rate on its home loans to the same level. The new rates of 6.9% at Kotak Mahindra come into effect from October 21, 2020.

The bank will, however, offer the concession in rates based on the borrower’s gender, occupation and credit score. A woman borrower who is a salaried employee and has a credit score of over 750 will be charged the lowest rate of interest on new home loans at Kotak. These rates are also applicable on home loan balance transfer at the bank.

Joining the league of financial institutions that have cut home loan interest rates to cash in on the ongoing festive season, public lender State Bank of India (SBI) has brought down rates to the sub-7% level. Announcing a rate reduction that could lower the cost of borrowing by up to 25 basis points (bps), India’s largest lender, on October 21, 2020, said the new scheme was an extension of the festive offers announced earlier.

New borrowers can now avail of housing loans of up to Rs 30 lakhs at an annual interest of 6.9%, while an interest of 7% will be levied on home loans worth over Rs 30 lakhs. To get the full benefit of the 25 bps reduction, borrowers would have to apply for the home loan through the SBI YONO app and have an impressive credit score, as well.

A credit score of above 700 is considered good by financial institutions.

As it is, women borrowers enjoy a further concession of 5 bps on SBI housing loans. So, they would be able to get loans at even lower rates, with the help of an impressive credit score and by applying through YONO.

“In an extension of its festive offers announced recently, SBI offers credit score-based concessions of up to 20 bps, from 10 bps earlier, for a home loan of above Rs 30 lakhs to Rs 2 crores, across India. The same concession would also be applicable for home loan customers for a loan amount of up to Rs 3 crores in eight metro cities. An additional 5 bps concession for all home loans is given, if applied through YONO,” the bank said in a press statement.

 

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Select SBI Home Loans Cheaper By Up To 15 BPS

India’s largest bank, State Bank of India (SBI) plans to offer discounts to home loan borrowers in the upcoming festive season. According to a statement issued by the lender, on September 28, 2020, SBI will offer a concession of up to 10 basis points on home loan interest, if the buyer purchases a unit in an approved project.

The borrower could avail of an additional concession of five basis points in home loan interest, if he applies for the credit through SBI’s YONO platform. Launched in 2017, YONO is a unified integrated app by SBI.

Additionally, the borrower will enjoy a full waiver on the processing fee that they have to pay as part of the home loan approval process. Financial institutions typically charge 25-100 basis points of the loan amount as the processing fee from the borrower.

This means for a home loan worth Rs 30 lakhs, the borrower might be asked to pay between Rs 7,000 and Rs 30,000 as the processing charge.

“There would be a complete waiver on processing fees on home loans for homebuyers in approved projects. The bank is also providing special concessions up to 10 bps on the interest rate for the customers, based on their credit score and loan amount,” SBI said in a statement. It begs mention here that a credit score of above 750 is considered good by financial institutions but a score between 300 and 600 is considered risky.

“Additionally, homebuyers can avail 5 bps interest concession if they apply for a home loan via YONO,” it added. 

Currently, SBI, the largest lender in the country with a 34% market share in the housing loan segment, charges interest ranging between 7% and 7.35% annually. By availing of the festive discounts, a borrower will be able to lower the interest up by to 15 basis points. 

SBI Lowers Home Loan Interest Rate To 6.7%

India’s biggest commercial lender State Bank of India (SBI) has rolled back the hike in home loan interest rates it affected in April 2021. The decision by the bank, which comes at a time when the second wave of the Coronavirus pandemic is expected to impact the economy to levels worse than that seen during the first wave in 2020, would bring down the home loan interest rate at SBI to 6.70 per cent.

However, the best rate by SBI will be offered only to buyers applying for small-ticket home loans.

While SBI will offer an additional rebate of five basis points (bps) to women borrowers, it would offer another five-bps concession to borrowers, if they apply for the home loan through the bank’s YONO app.

SBI home loan interest rate May 2021

Ticket size

Annual interest*

Up to Rs 30 lakhs

6.70%

Between Rs 31 lakhs and Rs 75 lakhs

6.95%

Over Rs 75 lakhs

7.05%

*With effect from May 1, 2021

 

This means that if a woman borrower applies for a home loan worth Rs 30 lakhs through the YONO app, she can get the best annual interest rate of 6.60 per cent. However, note here that the bank takes into account the individual credit scores of the applicant, while offering them the best rates.

Unlike the special scheme under which the SBI offered processing fee waiver to borrowers, it would now charge that levy, as announced in April. SBI now charges 0.40 per cent of the loan amount as the processing fee, subject to a minimum of Rs 10,000 and a maximum of Rs 30,000, with GST (Goods and Services Tax).

If you are buying a property with a builder that has a tie-up with the bank, you will be charged 0.40 per cent of loan amount as the processing fee, with the upper limit set at Rs 10,000, plus applicable tax. Note here that in such cases technical valuation of the property and title investigation reports or TIRs are not required, thus, enabling the bank to offer some discount.

 

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SBI Increases Home Loan Interest Rate To 6.95%

In a move that would prompt more banks to effectuate an increase in lending rates, India’s largest lender, State Bank of India (SBI), has hiked its home loan interest rates by 25 basis points (bps).

Borrowers will now have to pay 6.95 per cent interest on fresh loans from SBI. They will also have to pay 0.40 per cent of the loan amount as the processing fee.

The new rates come into effect from April 1, 2021.

 

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SBI Cuts Home Loan Rates By 10 Bps, To 6.7%

March 10, 2021: Public lender State Bank of India (SBI) has further lowered its home loan interest rates, to bring it down to 6.7 per cent. The new rates would, however, only be offered for a limited period, till March 31, 2021.

Moreover, SBI will offer the best rates to only those applicants, who have a good credit score, while also factoring in the home loan amount.

While the bank will be offering home loans of up to Rs 75 lakhs at 6.7 per cent annual interest, it will charge 6.75 per cent annual interest on home loans above Rs 75 lakhs.

 

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Delhi Cooperative Housing Finance Corporation Cuts Home Loans Interest To 6.75%

Days after the union territory government announced a reduction in circle rates, the Delhi Cooperative Housing Finance Corporation Limited has reduced its interest rates on housing loans from 7.45 per cent to 6.75 per cent, effecting a 70 basis points’ cut.

“With the directions of the Delhi government, the rate of interest for Delhiites to take housing loans has been reduced from 7.45 per cent to 6.75 per cent,” said Rajesh Goyal, chairman of the corporation.

In a statement issued on February 8, 2021, the bank also said that the reduction in interest rate would bring down the loan payment instalment from Rs 803 per lakh to Rs 760 per lakh, adding that the institution plans to launch offers especially for the mid-segment and affordable segment homebuyers in the near future.

This would significantly reduce the cost of property ownership for homebuyers in the national capital, considering that the UT government has also announced a 20 per cent reduction in circle rates for all types of properties in the national capital.

The affairs of the DCHFC are managed by a board of directors nominated by the Delhi government and it grants loans or advances to the members of cooperative housing societies. It offers loans to buy flats in group housing societies and buyers of DDA flats. It also offers loans for home extension and renovation, etc. Borrowers who are already servicing a home loan can also switch to the lender.

The term for individual loans is upto 20 years and the same is repayable in equated monthly installments (EMI) comprising the interest and principal. Interest at the bank is calculated on a monthly reducing balance basis. In case of persistent default towards repayment of the loan, legal action is initiated under the provisions of the Delhi Cooperative Societies Act, 2003.

 

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SBI Brings Home Loan Interest Rate Down To 6.8%

January 20, 2021: In a measure that would further enhance the competition in the home loan segment, India’s largest mortgage lender State Bank of India (SBI) has announced a further reduction in rates.

Effective January 8, 2021, home loans of up to Rs 30 lakh from the state-run bank will attract an annual interest of 6.8 per cent, down 10 basis points (bps) from the earlier 6.9 per cent. For home loans worth over Rs 30 lakh, the bank will now charge 6.95 per cent annual interest, after effecting a five-bps reduction in annual interest rates.

While women borrowers will be able to claim an additional five bps rebate on rates, the charge would be further lowered by another five bps if the application for the loan is being made using online channels, including the bank’s YONO app or its portals, homeloans.sbi, sbiloansin59minutes.com.

The lender is also offering several fringe benefits to customers, in order to lower their overall cost of borrowing. SBI, for instance, continues to offer its customers a complete waiver of the home loan processing fee, a measure it announced at the outset of the festive reason in September 2020. The bank typically charges a flat fee ranging between Rs 5,000 and Rs 10,000, as loan processing fees.

“With SBI’s lowest interest on home loans, we believe this move will facilitate and encourage homebuyers to take the home buying decision with confidence. With the nation all geared up to move ahead post-pandemic, SBI would continue to support homebuyers and the real estate sector,” said CS Setty, MD (retail and digital banking), SBI.

However, do note that at SBI, the best interest rates are offered to customers based on their credit score. Also, all these rebates are being offered for a limited time period, and will be effective till March 31, 2021.

“Home loan interest rates are linked to the CIBIL score and start from 6.80 per cent for loans up to Rs 30 lakh and 6.95 per cent for loans above Rs 30 lakh. Interest concessions up to 30 bps are also available in eight metro cities for loans up to Rs 5 crore,” SBI said in a statement.

 

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Festive Cheer: Kotak Mahindra Bank To Offer Home Loans At 6.75% Interest

November 4, 2020: In less than a month after the private lender reduced home loan rates to cash-in on the festive season, Kotak Mahindra Bank has further cut rates, intensifying competition in the home loans segment. With the recent reduction, Kotak Mahindra is currently offering home loans at an annual interest of 6.75%. Last month, Kotak Mahindra Bank lowered its lending rates by 10 bps, to bring it down to 6.95%.

With the latest cut, Kotak is offering the lowest rate of interest on housing loans after public lender Union Bank (6.7%). The lowest rates will, however, be offered to homebuyers, based on their credit score, the nature of employment and loan-to-value (LTV) ratio. To salaried employees who will be able to bear 20% of the overall cost of the purchase using their own savings, the bank will offer the lowest rate of 6.75. This works out to an LTV ratio of 80%.  Rates may go as high as 6.35% for salaried borrowers in case of 90% LTV ratio.

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SBI cuts home loan rate to 6.9%

India’s largest lender State Bank of India (SBI), on October 21, 2020, announced a reduction of up to 25 basis points (bps) in its home loan interest rates, in a move that could facilitate and encourage homebuyers to plan for the purchase of their dream homes.

The bank will now charge 6.9% annual interest on home loans of up to Rs 30 lakhs, while it will charge 7% interest if the loans are worth over Rs 30 lakhs. The banks has already announced a complete waiver on home loan processing fees, in order to push demand for home loans during the festive season.

To avail of the 25-bps concession, however, borrowers will have to apply for the credit through the SBI app, YONO. They will be able to take full benefit of the concession, depending on their credit scores.

“In an extension of its festive offers announced recently, SBI offers credit score-based concessions of up to 20 bps from 10 bps earlier, for a home loan of above Rs 30 lakhs to Rs 2 crores across India. The same concession would also be applicable for home loan customers for a loan amount of up to Rs 3 crores in eight metro cities. An additional 5 bps concession for all home loans is given, if applied through YONO,” the bank said in a press statement.

Banks that are currently offering home loans at the sub-7% level include Union Bank, Central Bank of India, Punjab and Sind Bank, Canara Bank and Axis Bank. Financial institutions started lowering rates after the RBI reduced the repo rate, at which it lends to scheduled banks in India, to 4%.

 

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SBI To Offer Cheaper Loans, Processing Fee Waiver

With an aim to give a boost to buyer sentiments amid the upcoming festive season, public lender State Bank of India (SBI) will charge no processing fee on home loans.

Typically, a borrower could be asked to pay 25 basis points* to 200 basis points of the loan amount, as the processing fee. Depending on the bank from where you are applying for the home loan, you may also be asked to pay a flat fee as the processing charge on the credit request.

The country’s largest bank has also decided to offer lower interest of up to 10 basis points, to homebuyers with good credit scores. An additional interest concession of five basis points is also available to borrowers, who apply for the home loan through SBI’s unified integrated app, YONO (You Need Only One).

However, these discounts will be available to borrower only if they select a housing projects that is listed as an approved project with the bank.

“There would be a complete waiver on processing fees on home loans, for homebuyers in approved projects. The bank is also providing special concessions of up to 10 bps on the interest rate for the customers, based on their credit score and loan amount. Additionally, homebuyers can avail 5 bps interest concession if they apply for a home loan via YONO,” the bank said in a statement.  While borrowers could apply for the home loan through the app, they will have to visit an SBI branch for getting an approval for the same.

Currently, SBI, which has a 34% market share in the housing finance segment in India, charges 7% interest on home loans of up to 30 lakhs from salaried individuals. If a borrower is able to avail of the festive benefit, they will be eligible to get this housing loan at 6.90% interest.

On home loans of Rs 31 lakhs to Rs 75 lakhs, SBI charges an interest of 7.25%. With the festive offer, the interest on this loan amount could be brought down to 7.10%, if a borrower has a good credit score and applies for the loan through YONO. For home loans of over Rs 75 lakhs, the lender charges an annual interest of 7.35%.

Note: *A 100 basis points is equal to one percentage point.