Your dream house may cost you more now.
If you are planning to opt for home loan of more than Rs 75 lakh then you must also get ready to pay higher interest rates. Banks are raising home loan rates for borrowers who are demanding huge amounts. They are resorting to 25 to 50 basis points hike in interest rates for loan amounts exceeding Rs 75 lakh.
Earlier the banks had two slabs for home loans- up to Rs 30 lakh and above Rs 30 lakh. Now a third slab that covers borrowings over Rs 75 lakh has been introduced by some of the banks. This slab is visible in country's largest lender, State Bank of India. SBI has included a new slab whereby home loans over Rs 75 lakh are charged 12.50% against 12.25% for loans between Rs 30 lakh and Rs 75 lakh and 11% for loans up to Rs 30 lakh.
These new terms have been effective from last month.
An official from SBI said, "The asset and liability committee (ALCO) of the bank has decided to introduce an additional amount tier for home loan borrowers considering the fact that borrowers of these loans mainly are the high net worth individuals (HNIs) and are in a position to pay the additional amount."
The official however confirmed that these higher rates are applicable only if the loan tenure is between 15 and 25 years. The slab change would be applicable on all the schemes of floating rate home loans. The raised interest rates are also applicable to NRI borrowers.
SBI's home loan rates have been revised for the second time since August 2008.
India's finance minister P Chidambaram has in fact asked banks to not interfere with the priority sector home loans- loans upto Rs 30 lakh. Priority sector loans like those for housing are likely to be lowered by 25-50 basis points after the Reserve Bank of India reviews the monetary policy on October 24.