Monday, December 15, 2008

Public sector banks cut home loan rates to prop up demand

Stung by a sagging demand for housing,
public sector banks today
slashed home loan rates
for a limited period
-- up to June 30, 2009 --
and capped interest rates at 8.5 per cent
for loans up to Rs 5 lakh
to encourage low-income housing.
For middle-income loans of Rs 5-20 lakh,
the interest rate has been capped at 9.25 per cent.

"The banks will also not charge any processing fee or pre-payment charges for loans up to Rs 20 lakh," State Bank's Chairman, O P Bhatt said, adding that free insurance cover would also be provided on loans under the above categories.

Freeze and Free!

Outlining the new housing loan package in accordance with the stimulus package announced by the Government on December 7, Bhatt said,
"There will be a freeze on any hike on these interest rates for a five-year period, but there will be no bar on the rates coming down further."
He said after the lock-in period of five years, the borrowers could look in for free or floating rates that could change in accordance with market conditions.

Own Contribution:

To make the package attractive, public sector banks would give the loans at a margin of 10 per cent up to Rs 5 lakh and 15 per cent for loans between Rs 5 lakh and Rs 20 lakh, and in either case, banks would offer free insurance cover, Bhatt said.

Only to New!

The above action would, however, be restricted only to new home loans and there would be no relief for existing borrowers, he said.PTI

Subscribe for free to receive hot Pune real estate news, views and reviews:

1) Ravi Karandeekar's Pune Real Estate Market News Blog

2) Ravi Karandeekar's Pune Real Estate Investment Blog

3) Ravi Karandeekar's Pune Real Estate Advertising and Marketing Blog

4) Ravi Karandeekar's Pune Real Estate Blog

5) Please, feel free to call me on my mobile +91 98600 44110! I enjoy talking, sharing my views and giving advice about buying property in Pune real estate market (so i do not charge anything for the first 8 minutes!)

6) Please, join me on Friendfeed, to share news articles, family photos, interesting links and videos and let us discover and discuss information!

Visit Ravi Karandeekar's Pune Real Estate Blog Group and join for free to receive updates of all blogs!

No comments:

Post a Comment