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
Up to Rs 30 lakhs
Between Rs 31 lakhs and Rs 75 lakhs
Over Rs 75 lakhs
*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.
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.
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.
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.
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.
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.
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%.
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.