Following a recent 25 basis point reduction in the repo rate by the Reserve Bank of India (RBI), the State Bank of India (SBI), the biggest bank in the nation, likewise lowered the cost of some of its loans. Many new commercial and retail loans now have lower interest rates due to the bank. Taking out a loan to purchase a home is made further simpler by the fact that these loans are linked with the External Benchmark Rate (EBR).
The current rate for home loans relating to EBR is 8.9%, which includes a 2.65% spread and the RBI's repo rate of 6.25%. Depending on your credit score, house loan interest rates now range from 8.25% to 9.2%. Home loan maxgain (overdraft) options fall between 8.45% and 9.4%.
The interest rates for top-up loans will range from 8.55% to 11.05%. Overdraft (or top-up) loans range from 8.75% to 9.7%. The rates for loans secured by real estate will range from 9.75% to 11.05%.
The fixed rate for senior citizen reverse mortgage loans is 11.3%. The interest rate on the YONO Insta Home Top-up Loan is 9.1%.
Your CIBIL (credit) score sets your interest rate. According to bankers, business loans and the Marginal Cost of Funds (MCLR) are linked. Only when deposit interest rates fall these will drop. In spite of the RBI's rate decrease last week, HDFC Bank raised its MCLR. One-year MCLR is also linked with SBI's auto loans. Right now, it is 9%. Only when the cost of deposits decreases this will decrease.
The range for Standard Car Loan varies between 9.2% to 10.15% which includes SBI Car Loan, NRI Car Loan, and Assured Car Loan Scheme. Interest rates are somewhat lower under the Loyalty Car Loan Scheme which falls between 9.15% and 10.1%.
Electric vehicle loans from SBI range from 9.1% to 10.15%. The range of two-wheeler loans is 13.35% to 14.85%. There is a 0.5% discount for electric vehicles. SBI's rate cut shows its desire to maintain competitive rates while encouraging sustainable automobiles.
SBI disclosed the loan-to-value (LTV) as part of its home loan terms and conditions: 90% LTV ratio up to Rs 30 lakh 80% LTV ratio for amounts over Rs 30 lakh and up to 75% LTV ratio over Rs 75 lakh.
SBI's terms and conditions regarding the floating interest rate stated "Interest on the loan will be charged at a fixed spread with EBLR linked RBI REPO rate on a daily reducing balance basis at monthly rests."