SBI cuts home loan rates, others may follow suit

Written by fe Bureau | Mumbai | Updated: Aug 27 2014, 07:28am hrs
Home loans of above Rs 75 lakh from State Bank of India (SBI) would be now cheaper as the lender on Tuesday decided to offer uniform interest rates irrespective of the loan amount. The new rates will be effective immediately. Home loans above R75 lakh will now carry an interest rate of 10.15%, a reduction of 15 basis points. Women borrowers can access home loans at a cheaper rate of 10.10%, irrespective of the loan limit.

HDFC is also offering home loans at 10.15% for all new borrowers, irrespective of the loan amount, under a scheme which ends on August 31. We will be reviewing this and take a call on interest rates after August 31, a HDFC spokesperson told FE.

Earlier, in December, SBI had reduced rates for home loans and rolled out a separate structure for women. For housing loans above R75 lakh, SBIs customers were charged 10.30% and women borrowers accessed home loans at 10.25%.For loans up to R75 lakh, customer were charged 10.15% and women home loans were at 10.10%.

SBIs home loan protfolio at the end of the June quarter stood at R1,44,210 crore, growing 15.58% year-on-year and the bank has a market share of 25.64%.

Earlier, in August, ICICI Bank too cut its interest rates on home loans to 10.15% for loans up to R5 crore for salaried individuals. Self-employed individuals will be charged a floating rate of interest of 10.15% for loans up to R75 lakh and for loans above R75 lakh and below R3 crore the rate will be 10.35%. The new interest rates came in effect on August 14 and will be effective till August 31 and is applicable for new borrowers.

ICICI Bank earlier used to charge customers 10.15% on home loan of up to R75 Lakh and loans above R75 lakh would be charged 10.50% for both salaried and self employed people.