Leading banks SBI and ICICI today cut their home loan rates by 0.10 percentage point to 9.4 percent following implementation of a new interest rate calculation regime mandated by RBI.
The lending rates of other banks may also fall soon with the Marginal Cost of Funds based Lending Rate (MCLR) system coming into force with effect from April 1.
If the banks decide to pass on the latest 0.25 per cent policy rate cut announced by RBI on April 5, the rates for borrowers may go down further.
SBI in a statement on Thursday said that it has fixed its home loan interest rate at 9.45 percent, which is 0.25 percentage point more than its one-year marginal cost of fund-based lending rate of 9.20 percent.
However, women borrower would get the loan 0.20 percentage point above the MCLR at 9.40 percent, it said.
The new rate is applicable from April 1, it said. As per the information available on SBI website, the earlier home loan rate 9.5 per cent for women borrowers and 9.55 percent for others.
As per ICICI’s website, the private lender’s minimum home loan rates are also at par with its bigger rival SBI as both the 1-year MCLR and the spread over it are same.
However, ICICI Bank’s effective rate of interest will go up to 9.65 per cent for loans above Rs 5 crore taken by women borrowers under floating interest rate. The weaker section borrowers will be able to avail loans of up to Rs 25 lakh at 9.40 per cent.
RBI had asked banks to price fixed-rate loans of up to three years based on their marginal cost of funds from April 1. All banks have to follow MCLR system, a new uniform methodology which will ensure fair interest rates to borrowers as well as to banks.