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Banks offer limited time discounts on home loan interest rates

By Rishabh Chamoli | 2022-11-16

At a time when the economy is witnessing the shockwaves of inflationary forces, several banks and financial institutions are offering some respite from high interest rates in the form of limited period discounts. These offers on home loan interest rates may give a much needed push to the realty market suffering amid high input costs.

The Reserve Bank of India (RBI) has hiked the repo rate four times this year by a total of 190 basis points, taking it up to 5.9 percent presently. Various banks and financial institutions have followed the footsteps of the apex bank by increasing their lending rates. This has automatically impacted the monthly takeout of the borrowers, discouraging many potential homebuyers from taking home loans and investing in real estate. However, since Diwali, a number of banks have announced limited period discounts by slashing their home loan interest rates.

Home loan rebate by Bank of Baroda
The Bank of Baroda (BOB) has decreased home loan rates by 25 basis points (bps) to 8.25 percent and waived off the processing charges, effective from November 11, 2022. The limited time offer will be available till December 31, 2022. The special offer will be applicable on balance transfers and will be linked with the credit score of the borrower.

Home loan rebate by HDFC Bank
Housing Development Finance Corporation (HDFC) and HDFC Bank announced interest rates from 8.40 percent onwards as a part of their festive scheme, applicable till November 30, 2022. Borrowers with a credit score of at least 750 are eligible for the low lending rate.

Home loan rebate by State Bank of India
The State Bank of India (SBI) also issued discounts of up to 0.25 percent, 0.15 percent and 0.30 percent on home loans, top up loans, and loans against property, respectively. Further, SBI announced new home loans and takeover loans starting at 8.40 percent, and home renovation and makeover loans from 8.80 percent. The bank has waived off the home loan processing fee until January 31, 2023.

Home loan rebate by Bank of Maharashtra
As part of the Diwali Dhamaka scheme, the Pune-based Bank of Maharashtra (BOM) also decreased the interest rate on their home loans. Effective from October 17, 2022, home loans were offered from eight percent, as opposed to 8.3 percent. The bank also slashed personal loan interest rates from 11.35 percent to 8.9 percent in addition to waiving off the processing fee on their home, gold and car loans.

With lending rates regularly surging to curtail the rising prices, the offers are a welcome move from the lender community to prevent real estate and the allied industries from experiencing another slowdown after the pandemic.