Home loans became cheaper, SBI & many other banks slashed rates

News
Jan 02 2017 03:16 PM
Hari Prakash Garg

Home loans became cheaper, SBI & many other banks slashed rates

Now, the banks gave a good news in the New Year for the common people seeking affordable homes. The largest bank of public sector, SBI is leading this move and it has reduced the home loan rates by 0.9% and now a borrower of Rs. 20 lakhs, as new loan for 20 years, will save Rs. 1147 every month.

The marginal cost of lending rates (MCLR) fell to 7.75% from 8.65%. The rates for one-year loans are now 8% as against 8.90%, while for loans of 2-year maturity rates are now 8.10% and for 3-year maturity, it is 8.15%.

The women borrowers of home loans of SBI will be able to avail loan at interest rates of 8.20% while others can avail home loan at 8.25%. Similarly, Punjab National Bank (PNB) reduced its MCLR to 8.45% and its rates of loans of 3 year’s and 5 year’s maturity the rates will be 8.60% and 8.75%, respectively.

Union Bank of India has also reduced its one year MCLR and the new rates are 8.65%. Two other banks, IDBI and State bank of Travancore had also announced cut in lending rates. Borrowers of IDBI bank seeking three-year loans will be charged at 9.30%, down 0.40%; while six-month loans have been pledged at 8.90%, down 0.35%. Now, IDBI bank will charge 9.15% on one-year’s maturity loans now, against 9.30% earlier.

Helped by substantial surge in deposits, the interest rate cut is expected to boost sentiments of common people, who suffered due to demagnetization. The new loan rates will be effective from day one of the New Year; but on the old loans, the old rates will continue to apply.