One of India’s major banks, State Bank of India (SBI), has released its recent-most update on home loan interest rates. Regular home loans taken for buying flats or houses for residential use will be subject to the new rates.
The decision comes in the context of escalating inflationary pressures in the economy. A few other banks have also taken similar steps, and many more are expected to follow suit in the coming weeks. The hike in SBI home loan interest rates is a reflection of the overall increase in interest rates in the economy.
For borrowers with credit scores equal to or greater than 800, the regular home loan interest rates have a minimum of 9.15%, according to the SBI website. The rate for borrowers with CIBIL scores between 750 and 799 is 9.25%. A credit score ranging from 700 to 749 conveys an interest rate of 9.35%. For these scores between 650 and 699, it is 9.45%. Additionally, SBI provides special home loan schemes with 5-basis-point discounts on the standard interest rates for female borrowers.
Clearly, higher home loan interest rates can lead to reduced demand in the real estate market. Lower property values, slower sales, and a shift towards renting instead of buying are some other negative impacts it can have on the sector.
Nevertheless, the increase in home loan interest rates may be a cause of concern for the borrowers, but SBI is likely to remain committed to offering affordable and accessible credit to all segments of society. The bank is also expected to continue to offer attractive interest rates to customers who have a good credit score and repayment track record.
If you are planning to buy a home and need a home loan, it is advisable to check the latest interest rates offered by different banks and compare them before making a decision. You can also approach SBI for more information on their latest schemes and interest rates regarding home loans.