State Bank of India cuts interest rates for home loans up to Rs 30 lakh: The State Bank of India (SBI) has announced to slash the interest rate by 5 basis points on its home loans up to Rs 30 lakh and the new rates are effective from Friday, reports said. Earlier, the Bank of Maharashtra had also announced a 0.05 per cent cut in its Marginal Cost of Funds based Lending Rate ( MCLR) for sixth-month loan tenor.
The SBI passed the benefit to customers and slashed its marginal cost of funds based lending rates (MCLR) after the Reserve Bank of India (RBI) cut the repo rate by 25 basis points in its sixth bi-monthly monetary policy review announced Thursday. MCLR is the minimum interest rate that a bank will charge on the loan. This will make the home buyer’s Equated Monthly Installments (EMI) cheaper. Apart from that, the SBI has also allowed homebuyers who have taken loan from other banks, to shift their loan at zero processing fees. The customers will also enjoy low interest rate benefit. This does makes your EMIs cheap.
RBI Governor Shaktikanta Das had said he will speak to bankers to ensure a quicker and better transmission of the policy rates in a meeting scheduled to take place in two-three weeks.
In a major boost to rate sensitive realty and auto sector, the RBI had lowered the repo rate, the rate at which the central bank lends money to commercial banks, by 25 basis point to 6.25 per cent. Justifying the move, RBI Chairman Rajnish Kumar said the Central bank has the highest market share in the home loans market and it is trying to empower the lower and middle-class segment by transmitting the rate cut announced by the SBI.