New Delhi: The Reserve Bank's monetary policy Committee on Thursday announced interest rates. The repo rate has been cut by 0.25%. It has come down from 6% to 5.75%. The reduction in the repo rate will be cheaper than all kinds of loans. However, it is up to the banks to decide how long and how much they give to the customers when they benefit from the repo rate reduction. The repo rate is the rate at which RBI lends loans to commercial banks.

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This would be the kind of advantage

Under this rule, if you have taken a home loan of Rs 20 lakh for a period of 20 years, 8.60 per cent interest rate so far, you were giving Rs 17483 as EMI. But now, in terms of the new rates, you have to give EMI of Rs 17167. That means you will be able to save Rs 316. On a home loan of Rs 30 lakh, you will save Rs 474. Earlier, while you were giving Rs 26225 as EMI, you now have to pay Rs 25751.

With this, if you have taken a car loan of Rs 3 lakh for a period of five years, 9.40 per cent interest rate so far, you were giving Rs 6286 as EMI. But now, in terms of the new rates, you have to give EMI of Rs 6249. That means you will be able to save Rs 37. There will be a saving of rs 61 on a car loan of Rs 5 lakh. Earlier, while you were giving Rs 10477 as EMI, you now have to pay Rs 10416.   

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