New Delhi: Axis Bank (formerly UTI Bank) has also joined the race of reducing home loan rates. However, Axis bank has gone a step further and slashed its home loan rates by 50 bps, which translates to 0.50% for both existing and new customers.
A host of banks, including IDBI, Bank of Baroda, HDFC, Union Bank of India, Canara Bank etc. had reduced the interest rates on home loans in the past few months. The common factor in the rate reduction by all of these banks is that they offered discounts only to fresh home loan takers. The existing customers, who are already facing the brunt of high interest rates, particularly resented this move favoring only the new home loan customers.
Imtiaz Ahmed, assistant VP, Axis Bank said, "Banks usually acquire fresh customers by offering a lower rate on floating loans, but we want to maintain a parity between both our existing and future customers."
These reduced interest rates will be effective from October 1st. The floating interest rate on home loans will reduce to 10.5% from existing 11% for both new and existing customers. However, the fixed rate home loan won't change and will remain at 13 percent.
Nearly 95 percent of the Axis Bank home loan customers opt for floating interest rates, and Axis has no immediate plan to change the fixed interest rate on home loans.
Axis Bank offers home loans to salaried individuals employed by government or reputed companies, professionals (doctors, engineers, dentists, architects, chartered accountants, cost accountants, company secretary, management consultants only) and self employed individuals who file income tax returns.
The applicant should have a minimum age of 24 years and maximum age up to 65 years or less at the time of loan maturity.
Home loans from Axis Bank are available for amounts starting from Rs.100,000 to Rs.5,000,000 for a maximum tenure of 20 years. Applicants seeking home loans from Axis Bank have to provide 15% of the loan amount as down payment.