SBI Home Loan: SBI Home Loan has become expensive. In fact, State Bank of India has increased its home loan interest rates by 25 basis points. This will affect those taking new home loans. Now the interest rate of SBI’s home loan is between 7.50% to 8.70%. The interest rate of SBI’s home loan was between 7.50% to 8.45% earlier.
However, this increase has been made at upper limit interest. This means that if your credit score is slightly lower, you may have to pay more interest. This will increase your EMI.
SBI has increased the upper interest rate of home loan from 8.45% to 8.70%. However, the lower limit ie 7.50% has not been replaced. This means that people who have good credit score can get a low interest rate as before. On the other hand, if your credit score is low, then you have to pay more interest. This will increase your monthly EMI and total interest burden.
Understand how much EMI will increase with the example
For example, if you take a home loan of 50 lakh rupees at 8.70% interest rate for 20 years, then your monthly EMI will be around Rs 44,026. In 20 years, you will pay a total of Rs 55.66 lakh as interest. If the interest rate was 8.45%, EMI would have been Rs 43,233. At the same time, interest will have to be paid 53.75 lakh rupees.
Bank took this step to save profits
This decision of SBI has come when the Reserve Bank of India (RBI) has kept its repo rate stable at 5.55%. Usually interest rates decrease when the repo rate is low, but SBI takes the opposite step. Experts say that banks are doing this to save their profits, because the demand for home loan is increasing. Therefore, the margin of banks is decreasing due to low interest rates.
