State Bank of India cuts the processing fee till 31-March-2017

SBI Home Loans no processing fee for New Home Loans and for Balance Transfer till 31st March 2017.

State Bank of India to boost the volumes of Home Loan business for the last quarter of the 2017 financial year, SBI had launched a special campaign for Home Loans. Under the Home Loan campaign, Processing Fees on all Home Loan proposals(both takeover and new) sanctioned and partially/fully disbursed upto 31-Mar-2017 will be filly waived. The waiver of the processing fee will also be made available to proposals sourced upto 31st March 2017, provided the loans are partially/fully disbursed latest by 30th April 2017.

However , the processing Fee at the applicable rate will be recovered upfront in respect of all Pre-Approved Loans(PAL) and the same will be refunded to the customers by way of credit to the loan account in respect of all PAL proposals source during the campaign period upto 31-Mar-2017 and partly/fully disbursed on or before 30th April 2017

SBI Home Loan
SBI Home Loan

With the decrease in the MCLR for 1-year to 8.00% was itself a big boost to the Home Loan customers. But increase of the margins from 0.10% to 0.60% has added heavy burden to the home loan seekers. Most of the customers are still seeing the fall in the Home Loan rates from 9.10% to 8.60% which is like a mirage which is a short term profit and long term loss compare to the customer who had taken loan in Dec-2016.

Let me explain in detail,  Before I tell you, why customer who had taken home loan in Dec-2016 is better rate then present. I would like to explain, how the interest rate is set. Interest rate consist of 2 components.

 

Interest Rate = 1-Year MCLR  Rate + Margin Rate

Recent announcement was :  1-year MCLR Rate : 8.00 %

Margin Rate  was : 0.60 %

So effectively the Interest rate was set to  8.60 %  = 8.00 % + 0.60 %

What is 1-year MCLR ?

When we avail a loan with 1-year MCLR,  it’s 1-year Fixed loan. Which means any changes in  MCLR during that 12 months, your home loan will not be affected. For example if you availed home loan in Dec-2016 your interest rate change will be only in Dec-2017. So any change , decrease of MCLR or increase of MCLR, your home loan rate will not change during this 12 months. In Dec-2017 your home loan rate will get updated based on the 1-year MCLR during Dec-2017. Again next change will be next year Dec-2018 and this would continue till closure.

What is the Margin Rate ?

Margin Rate is what Banks take as the operational costs. It gets fixed when you have taken.  For example if you had availed home loan in Dec-2017 your home loan should have been 9.00% (8.90 + 0.10) your margin should be only 0.10 %. So your Interest rate would be 1-year MCLR + 0.10% for ever.

Now let’s compare your home loan with the new rates

Year 1-Year MCLR Customer who had taken in Dec-2016 time frame. Customer who had taken in Jan-2017 time frame.
Dec-2016 8.90 % 9.00 % (8.90+0.10)
Jan-2017 8.00 % 8.60 % (8.00+0.60)
Jan-2018 If 7.50 % in Dec & Jan 7.60 %(7.50 + 0.10) 8.30 %(7.70 +0.60)
Jan-2019 If 8.60 % in Dec & Jan 8.70% (8.60 + 0.20) 9.05% (8.60 + 0.45)
Sep-2019 If 9.25 % in Sep & Jan 9.35 %(9.25 + 0.10) 9.85%(9.25 + 0.60)

It would continue till the closure of the loan.  What we are seeing right now is, Short term profit and long term loss. People who convert to new rate without the long calculation they would start to pay every year 0.50% more than December rate.

1-year-MCLR had decreased drastically only due to demonetisation. Hopefully we need not stand in long Queues every year. Mostly its once in lifetime event.

Instead of banks making profits due to demonetisation drive they should have passed on the benefits to the end customers.

Hope to see cut in the Margins in coming days. Happy home Loans.

This complex calculations and to understand what is long term profit & short term loss versus short term profit with long term loss is better to be left to the professionals. http://loanyantra.com is best at this. We will wait for the margins to come down, then we would recommend the right change that would ensure you save the most on your home loans…

Happy Home Loaning…

Team

Loanyantra.com

Silver 90 Offer on Home Loan

“Silver 90 Offer “

            Apply Home Loan

                                                   Get Upto 1 Kg Silversilver_loanyantra-com

Avail Home Loan from Loanyantra.com and get Silver free.

T&C

  1. Offer from Loanyantra .com(Formally Renaud Financial Consultancy Services P Ltd, Regd Off @ Address.)
  2. Max Reward  is 1 Kg silver for 4 Cr home loan.  Multiplies with 2.5 Grams for each Lakh. Ex: 1 Crore : 250 Grms, 50 Lacs: 125 Grams..
  3. Home loan sanction and disbursement should be happen between Jan 1st 2017 and March 31st 2017
  4. Minimum  70% of the sanction amount must be disbursed before 31st March to avail offer. (Exempted for SBI and HDFC. There is no minimum disbursement required for these banks).
  5. Rewards will be handed over within 45  days of first disbursement.
  6. We reserve to determine all rights to finalize the eligibility of the offer to the user.
  7. Cash refund not allowed. We will issue silver only as mentioned in the offer.
  8. Without above offer also user can avail Home Loan.
  9. Subjected to Hyderabad Jurisdiction. 

Is floating rate of a home loan always higher than fixed rate?

To start of with its always other way round.

Fixed rate is always higher than the floating rate.

Why do the bank take higher rate for Fixed compare to Floating rate ?

Banks normally charger 0.50% to 2.00% more than the Floating rate based on the fixed period tenure. You can opt for 2-years fixed, 5-years fixed or 10 years fixed or fixed till closure. Based on the how fixed tenure banks would charge higher than the floating. Banks higher higher so that they are covering the risk in future. If the REPO rates go up then banks have at least don’t make loss on your loan. For example people who have availed the loan say in 2000 with fixed and still holding it would be paying only at say 7.50% . To cover this risk they charge more.

When do you opt for Fixed rate Home Loans ?

  1. If the rates are upward trend then you can go for Fixed Rate of Interest. Right now the interest rates are downward trending so be on Floating and convert to Fixed later.
  2. If you want to be more secure and don’t want to be affected by rate changes then opt for Fixed rate. In case if you can manage your loan well , i.e make the necessary changes in the loan by making part-payments and correcting to new rates then go for Floating rate.

Disadvantage of Fixed Interest rate Home loans?

  1. If you want to refinance from a different bank, because they are giving a better rate then you might have to pay 2% as penalty on the outstanding amount. Where as in floating rate, there are no penalty if you are refinancing.
  2. If the rates are downward trending then you are at loss.
  3. Look into the conditions banks would apply for fixed loans, like the part-payments, increase of the EMI or pre-closure by self funding. They vary from floating rate. Normally they are free for floating rate of Interest for home loans

My suggestion would be if the loan amount is small or the tenure of loan is small then go for Fixed rate of Interest for Home Loan or else its good advice to go with fixed rate of interest and manage it well.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online

Can I apply home loan from two different banks and can avail the best one after they both provide an approval letter?

Yes You Can .. but You Should Not.

You can apply for as many banks and NBFC you like to apply. But you need to know what are the disadvantages you will have if you apply for multiple loans.

Disadvantage of applying with multiple banks for home loan for same property ?

  1. Every bank will check your credit report and its a hard touch. Which means on every time bank pulls your credit report your credit would come down by certain points. Also it would be reflected in you Credit report who had queried it. So it affects your credit score and it affect your loan eligibility over all
  2. Every bank or NBFC would charge you a processing fee. Its compulsory to take a cheque leaf as a processing fee. If the banks or NBFC say ZERO-Processing fee, that would mean they would refund it once the loan is disbursed, it will not be refunded if its only sanctioned and not disbursed. So now you will have to pay to multiple banks.
  3. In time to come all the banks are maintaining a common data base of the loan process state for a certain property. If one bank is processing then other bank till NOC from other bank will not process. This system is under proposal and will be available shortly. Right now Banks and NBFC use CERSAI for it.
  4. Last but not the least, you will have to face multiple bankers, have to submit multiple times the same documents and the pressure the banker or brokers would put is not pain free. So avoid it.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

Instead of applying with multiple lenders its always good to get right suggestion and apply for one lender.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

What would be the down payment of a ₹50lakh house in most of the metro cities in India?

Normally it’s 20% of the amount should be self funding.

So for a 50 lac loan. It would be

Self funding : 20% of 50 lac. is Rs 10 lac

You can apply for home loan for 80%. That is for 40 lac loan.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online1

Home Loan Glossary

Home Loan commonly used words while processing Home Loan.

  1. Home Loan – Amount borrowed to buy a home from a lending institution.
  2. PF – Processing Fees.
  3. Sanction – Approval of loan amount.
  4. Disbursal – Release of the sanctioned amount.
  5. PreApproval – Credit Approval of loan amount.
  6. PreEMI – Interest served before commencement of the EMI.
  7. EMI – Equated Monthly Installment.
  8. Amortization – Breakup of the principal and interest component in an EMI.
  9. PrePayment – Advance Principal repayment.
  10. BT – Balance Transfer or Refinance.
  11. Reimbursement – Loan Payment to be reimbursed in favour of the borrower.
  12. Balloon/Bullet payment – One shot principal repayment.
  13. Alternate Collateral –
  14. Additional Collateral – A full term secondary security taken along with the primary.
  15. Interim Collateral – A short duration additional security.
  16. Penalty or PPC – Pre Payment Charges, levied on advance principal repayment.
  17. ECS – Electronic Clearing System.
  18. IT Certificate – Income Tax Certificate for claiming tax benefits.
  19. SOA – Statement of Account.
  20. RTR – Repayment Track Record.
  21. LAP – Loan against Property.
  22. PLR – Prime Lending Rate.
  23. Spread or Margin – A constant on which a floating rate floats.
  24. Floating or ARM – Adjustable Rate Mortgage.
  25. Fixed Rate – Mortgage on fixed rate.
  26. MMC – Money Market Condition.
  27. Credit Report – An independent summary of an individuals credit history.
  28. RCU – Risk Control Unit.
  29. FI – Field Investigation.
  30. PD – Personal Discussion
  31. MCLR – Marginal Cost of Funds based Lending Rate

Why I don’t drive to office instead choose Ola Share and Uber Pool ?

These days most of my friends are travelling to office by Uber Pool or Ola Share rather than driving there own cars. One gets a luxury of not driving in the traffic, utilising the travel time and travelling at cheapest cost.

Why I choose Uber Pool and Ola Share over riding my own car is for a very different reason that you will surely fail to guess.

Firstly, I get a chance to spend 30 Minutes to 1-Hour with a most of the young hardworking entrepreneurs who have put there car in online car portals.  All of them by profession might be same but every one has a story, every one working hard on the road to generate more money. A journey that gives me a good way to start a day and end a day as an entrepreneur.

Secondly, revealing one of our secret sauce of lead generation is, Uber Pool and Ola Share are the cheapest source of lead generation for us. During the travel, I get to speak with at least 2 co-passengers about Loanyantra and give tips. Fortunately or Unfortunately they don’t have no other option but listen or be part of the discussion. Where else can you get 100% engagement of the customer for so long. Normally I keep it very interactive and tell about how we started it and how startups work. Once I introduce my self as one of the founder of the startup of Loanyantra, mostly my co-passengers get into the conversation. Till today everyone had dropped there mobile number or have taken my visiting card for the Home Loan correction.

Thirdly,as the famous Bangalore local quote, “If you throw in stone a street, it will either hit a Dog or a Software engineer. “. In both the cities Hyderabad & Bangalore lot of the young software engineers are using Uber Pool or Ola Share to travel. What would be better place it can be to interview few bright faces while on travel. Still not fortunate in hiring due to different skills. I forward few of the bright CV to my friends startups in T-Hub.

Last but not the least, when the world is moving towards digital the common interaction with the strange has reduced drastically. Here I get to meet new friends get to know what they are doing. Sometimes new insights. One occasion I got to meet one of the top bank Customer Relation Manager who is handling business loan portfolio of Rs 2000 Cr. His insights into the business and process was one of the best interaction I had in the travel. Hope to have more of such great interactions.

Loanyantra Uber Pool Ola Share
Why Loanyantra Co-Founder & CEO uses Uber Share & Ola Share instead of driving his own car.

Happy travelling and happy pooling and happy sharing… My journey continues… Hope to see you as one of the co-passenger soon… 🙂

 

After all my research about home loans in India I have come to the conclusion that every bank has its negative so which bank is the least problematic?

Every bank and every loan product has advantage and its own disadvantage.

When you are selecting a bank , you nee to be clear on what you want.

  1. Faster processing of loan. With all the documents in place
  2. Faster processing of loan. With some documents in place
  3. No processing fee and other fee
  4. Want more LTV. More Loan eligibility
  5. Lesser Interest rate
  6. Need OD home Loans. Smart saver
  7. No other charges in future
  8. Need to add co-applicants like Mother, Father, Brother or even Father-in-law and others
  9. With Bad credit score with all NOC in place
  10. Less charges and overhead while processing the loans
  11. Easy to pay Part-payments and accepts any amount as part-payment
  12. Easy to foreclose the loan
  13. In future want to avail top-up loans
  14. Want interior loan with the same rate of home loan.
  15. Pre-sanction of the loan.
  16. Loan for property in the outskirts of the city.
  17. Loan for the property with deviation.

Based on above, you would have only few products and few banks which you give you hassle free loan.

I would recommend you check your eligibility on home loan comparison portals like LoanYantra | Get Home Loan Online and they would help you in choosing the right home loan.

If you plan your loan well, you will be able to close it faster and home will be fully yours.

If you are looking for Home Loans and want right home loan fit for you and to plan it well to close fast then apply on LoanYantra | Get Home Loan Online .

If you already have existing home loans then to plan it well and close faster, then manage the loan on Loanyantra for free Home Loan Management Company India: LOANYANTRA

Home Loan Interest Rates

What is Home Loan Interest Rate?

Home Loans have become the best medium to buy homes. Banks and NBFCs offer various home loan schemes and alluring interest rates that attract the home buyer. The key deciding factor for a customer to avail home loan from a particular financial institution is determined by the interest rate. The interest rate is charged on the principal loan amount. 

What determines interest rates on your Home Loan?

It is the bank that decides their lending rates. This depends on their cost of funds and NIM or Net Interest Margin which the banks need to earn to earn a profit and cover their operation cost.

An important point to note here is that home loans to salaried employees are offered at a lower rate as compared to those who are working in the unorganized sector; the prime reason for this is the stability of income of salaried employees.

The home loan interest rates calculation by the nationalized banks is presently based on MCLR or Marginal Cost of Lending Rate method. To this rate, the spread is added and then the final interest rate is mentioned to the customers or borrowers. And the NBFCs use Prime Lending Rate (PLR) calculation method.

Types of Home Loan Interest Rates

There are two kinds of home loan interest rates:

  • Fixed Interest Rate Loan-   This rate of interest remains fixed and the borrower has to pay a fixed EMI during the home loan tenure. The market fluctuations don’t impact the home loan rate. A major point of concern when it comes to fixed home loan rates is they are 1-2.5% higher than the floating rate of interest. If a borrower has fixed home loan then he/she doesn’t get the benefit if the home loan rates go down. Their EMI remains unaffected by it.
  • Floating Interest Rate Loan–  As the name indicates, floating rate loans have interest rates that change with the market condition. The are highly susceptible to market fluctuations. If the base rate changes, the floating rate also gets changed along with it. They are usually cheaper than the fixed rates but being highly influenced by the market condition they may vary as the RBI changes the rates.


Factors affecting home loan  
interest rate

  •    home-loan-interest-rates_loanyantra-comIncome
  •    Credit score
  •    Location of the property
  •    Loan amount
  •    Type of loan
  •    Loan tenure
  •    Type of interest rate
  •    Employment type
  •    On-going promo offers

All the banks and HFCs offer lucrative and competitive interest rate on the home loan, here is

The list of banks and HFCs and their interest rate.  

Banks and HFCs associated with Loanyantra Home Loan Interest Rate Range
SBI 8.50% – 9.10%
ICICI 8.65% – 10.10%
HDFC 8.65% – 9.25%
DHFL 9.00% – 10.00%
Indiabulls 8.65% – 12.25%
Standard Charted Bank 9.25% – 9.4%
Aditya Birla Housing Finance 8.65% -8.89%
IDBI 9.35%
Axis 9.15%-9.35%
CITI 8.8%- 9.55%
HSBC 8.85%-10.4%
Banks and HFCs not associated with Loanyantra Interest Rate
PNB Housing Finance 8.9% – 9.6%
LIC Housing Finance 8.5%
Kotak Bank 8.75%
Edelweiss 10.5%-10.9%
Reliance Capital 10%-11.75%
Bank of Baroda 9.6%
Indian Bank 9.65%
Dena Bank 9.6% – 9.85%
Bank of India 8.6% – 8.75%
Federal Bank 9.6%
Union Bank of India 8.8%
Allahabad Bank 8.7%-9.25%
Bank of India 8.65%-8.7%
Bank of Maharashtra 8.75% – 8.85%
Canara Bank 9.15%-9.70%

Discount on home loan interest rates by LOANYANTRA

Loanyantra is a one stop shop for all kind of home loan services. You process your loan with us and get 0.10% discount on the interest rate for one year. Also, manage your loan by the services provided by loanyantra. Get door-step service for the collection of documents and submitting them. Get updates about the process till disbursal. Our first priority is to understand our customer profile and then suggest them the best home loan which will match their requirement perfectly.  Get connected with us today to know more about home loans.

SBI Home Loan Interest Rates 2017

The most awaiting part of the demonitisation is here. Low interest rates for home loans. After the P.M., Narendra Modi’s speech on 31st December, 2016, banks now race with each other to reduce the home loan interest rates. Since there were no rate cuts by RBI Governor in the recent quarter review, there were less hopes for interest rate reduction.

After Modi mentioned in his speech about banks taking care in encouraging the poor, SBI had taken initiative in reducing the home loan interest rates. The new year started with the rate cut war.

SBI Home Loan Interest Rates

“THE MOST PREFERRED HOME LOAN PROVIDER” voted in AWAAZ Consumer Awards along with the MOST PREFERRED BANK AWARD in a survey conducted by TV 18 in association with AC Nielsen-ORG Marg in 21 cities across India.

sbi-home-loan_loanyantra-comSBI Home Loans come to you on the solid foundation of trust and transparency built in the tradition of SBI
  • Flexible repayment with tenure up to 30 years
  • Choose your loan amount and repayment schedule
  • Apply & get instant approval

Know more about the current SBI Home Loan interest rates

SBI Home Loan Interest Rates for women 8.60% – 8.65%
SBI Home Loan Interest Rates for Others 8.65% – 8.70%
SBI Maxgain Interest Rates above Rs. 20 lacs & upto Rs. 75 lakh (women) 8.75%
SBI Maxgain Interest Rates above Rs. 20 lacs & upto Rs. 75 lakh (others) 8.80%

sbi-home-loan-current-interest-rate_loanyantra-comExisting Home Loan borrowers can opt for switch over to current rate of interest on Home Loans by paying 0.50 % + applicable Service Tax of the outstandings

Get more benefits by availing your home loan through loanyantra.com. Get extra 0.10% discount on the interest rate for an year. The existing customers enjoy the benefit of managing the home loan and reducing the interest rate  on self interest.

Follow us and know more customised tips and save more on your home loan.