Home loan rates: Recently SBI has cut the home loan rates to a six-year low of 9.1 %. And it is said that the other leading private banks are likely to follow the footsteps of SBI by slashing the home loan rates by 0.20% to boost lendings in the festive season.
We do see up to 15-20 basis points (0.15-0.20%) room left for banks to further cut interest rates.
-Karthik Srinivasan, Senior VP Financial Sector Ratings
Home loan rates reduced by leading Private Banks
ICICI Pvt ltd has also reduced the home loan rate by 10 basis points making the lending rate 8.95%. It is also offering the overdraft facility along with the reduced home loan rates. In a special scheme for the salaried customers ICICI will be forwarding a credit facility against the home loan amount. The threshhold limit for the loan can be extended upto Rs 1 crore.
Earlier in October, Reserve Bank of India had cut the repo rate by 25 basis points. This will help the masses get cheaper loans.
This major reduction in the loan rates comes as a shift from the base point method of setting up interest rates to the MCLR (Marginal cost of Funds-based Lending rate). The MCLR rates are revised every month, the laon is lended with a condition that MCLR might be revised in the future.