The pandemic has taught people multiple things. It has not only raised the empathy among the people for the poor and marginalized section of the society, but it also increased the savings bracket for the people. There are also reports suggesting that people from second and third-tier cities also started to invest in the stock markets and mutual funds. However, there are also people who had to take loans to survive. The loans come with interest rates and if you have taken a loan from the biggest public sector bank, then you might repent it.
If you have taken a home loan or car loan from the State Bank of India (SBI) recently, then this news update is surely for you. SBI has increased home loan rates by 25 basis points which are effective from April 1, 2021. Apart from this, the bank clearly said that there will be no processing fee waiver. State Bank of India (SBI) has started charging 0.40 percent plus taxes on the net home loan amount as a processing fee. The rates have been increased by the State Bank of India (SBI) withdrawing its ‘limited period offer’ after which original rates of interest have been replaced. And it is expected that other banks will also be implementing the same changes in home loans and car loans.
The new rates on SBI home loans from the 1st of April start at 6.95%, compared to 6.7% till 31 March. So now the borrowers are left with two options: either choose increased tenure or choose to pay extra EMI (Equated Monthly Instalment). If a person has taken a loan recently, then it is possible that the banks themselves may increase the tenure of the loan instead of increased EMI. For example: If the rate of home loan has increased by 50 points, and assuming the home loan to be Rs. 50 lakh and tenure of the loan be 20 years, one will have to pay 23 EMIs more. If in case you don’t want the tenure of your loan to be increased, then you are required to pay an extra Rs.1515 per month towards your home loan EMI.
If in any case, you would like to switch your current home loan because of the increase in the interest rates, then you can find banks offering the same loan amount with lower interest rates. Experts also have an opinion regarding the two options borrowers are left with. They say it is better not to opt for an increased tenure of the loan because it will increase your total interest payout.
Hence be wise in choosing home loans and car loans with nominal rates of interest for a particular number of years offered by trustable commercial banks offering other advantages too like flexible repayment period, interest concession for women borrowers, lower processing fees, no prepayment penalty on floating rate home loans, consultancy services, etc. But the State Bank of India (SBI) also has a positive side. State Bank of India (SBI) is the first choice of every home loan seekers in India. “State Bank of India Home loan” offered by State Bank of India (SBI) is the ideal choice because of the lowest home loan interest rate, Lower Processing fees, special offers every month for women, government employees, etc.
Until and unless it is a necessity, don’t go for a loan or Every Month Instalment option with any of the banks. During the pandemic, do not start any new projects like construction or a new home as the rates are highly inflated. Choose the banks wisely for taking the loans.
Be First to Comment