Both public as well as private sector banks including the State
(SBI), Bank, Bank of Baroda (BoB) and Punjab National Bank (PNB) are offering home loans at a record low-interest rates to cash in the spending rush ahead of the festive season.
State Bank of India (SBI) has announced that it will charge home loan borrowers an interest of 6.7% based on their credit score, irrespective of the loan amount. The offers are available to all segments of borrowers irrespective of the profession of the borrower. The 6.70% home loan offer is also applicable to balance transfer cases.
“There is already a growing desire to own a home as consumers look at it as a necessity in this unprecedented time of the COVID-19 pandemic. With the onset of the festive season, there is a stiff competition amongst the financial institutions to provide the consumers with the best home loan interest rates… These factors are also proving to help spur the real estate demand that was temporarily hit last year as a result of the pandemic,” said Ashok Mohanani, President, NAREDCO Maharashtra.
HDFC too, announced a festive offer with home loans starting from 6.70%. This offer will be applicable to all new loan applications irrespective of the loan amount or employment category. The special festive offer is for all loan slabs and for all customers with credit score of 800 and above.
Many homebuyers may abstain from making purchases during the ongoing Pitrupaksha period that will come to an end in the first week of October. However, the festive quarter of October-December usually witnesses a surge in housing sales across cities as homebuyers prefer this auspicious period including Navratri, Durga Puja, Dussehra and Diwali to book and buy properties.
“Considering the auspicious festive season ahead, the timing of the reduction in interest rates by leading banks couldn’t have been better. The real estate market has seen decent sales this year and this reduction in interest rates would further help to keep up the sales momentum,” said Cherag Ramakrishnan, MD, CR Realty.
Kotak Mahindra Bank has reduced its home loan interest rates by 15 basis points (bps) to 6.50%. This special rate is a limited period festive season offer beginning 10th September and ending 8th November 2021.
“Lower interest rates will help push the conversion of demand from end users as affordability will improve. A lot of prospective first-time homebuyers will be able to take the decision as it becomes viable for them to buy an apartment. It will also allow homebuyers to upgrade to a relatively bigger home, the importance of which has come to the fore following the pandemic,” said Aditya Kedia, Managing Director- Transcon Developers.
Bank of Baroda (BoB) is also offering a waiver of 0.25% in the existing applicable rates for home and car loans. In addition to a processing fees waiver for home loans. Now, its home loan rates will start at 6.75% and car loan rates start at 7%.
Punjab National Bank (PNB) too has slashed the repo-based lending rate by 25 basis points (bps) to 6.55%.