Getty ImagesHome loan borrowers must keenly watch their home loan equated monthly installments (EMI) as home loan interest rates are on the rise after the Reserve bank of India hiked the repo rate by 50 basis points to 4.90 percent. This is the second time the central bank has raised key rates since May 2022.
Now borrowers will have to prepare for continuous interest rate hikes on their loans after enjoying decadal low-interest rates.
Here is a look at 5 banks offering the cheapest home loan interest rates.
How much your EMI will increase
The total rise in the repo rate after the current boost is 0.9 percent. Because of the central bank's rate hikes, lenders such as banks and housing finance businesses will raise their lending rates in response, which means your EMIs will rise as well. Your EMI will increase by Rs 1,648 from Rs 23,259 to Rs 24,907. If you have a home loan with a balance of Rs 30 lakh and a balance tenure of 20 years at 7% pa interest, your EMI would increase by Rs 1,648 from Rs 23,259 to Rs 24,907. You may have to pay an extra Rs 55 in EMI for every lakh rupee borrowed.
Also read: ICICI Bank, Bank of Baroda, Bank of India, PNB hike home loan interest rates: Check latest rates here
Loan amount
Most lenders offer housing loans ranging from 75 to 90 percent of the cost of the property, depending on the loan amount, as defined by the regulator. Depending on your house loan eligibility, if the property is evaluated at Rs 50 lakh by the lender, you can get a maximum loan of Rs 40 lakh (80% of the property cost for a loan amount up to Rs 75 lakh).
Pre EMI
Pre-EMI is a term that refers to a loan that is being taken out on a property that is still being built. In this instance, your loan is disbursed in stages dependent on the quantity of instalment payments you must make to the developer. According to , “You are generally required to start paying only the interest on the loan amount disbursed (called the pre-EMI interest). In case you wish to start principal repayment immediately, you may opt to tranche the loan and start paying EMIs on the cumulative amounts disbursed.”
Now borrowers will have to prepare for continuous interest rate hikes on their loans after enjoying decadal low-interest rates.
Here is a look at 5 banks offering the cheapest home loan interest rates.
How much your EMI will increase
The total rise in the repo rate after the current boost is 0.9 percent. Because of the central bank's rate hikes, lenders such as banks and housing finance businesses will raise their lending rates in response, which means your EMIs will rise as well. Your EMI will increase by Rs 1,648 from Rs 23,259 to Rs 24,907. If you have a home loan with a balance of Rs 30 lakh and a balance tenure of 20 years at 7% pa interest, your EMI would increase by Rs 1,648 from Rs 23,259 to Rs 24,907. You may have to pay an extra Rs 55 in EMI for every lakh rupee borrowed.
Also read: ICICI Bank, Bank of Baroda, Bank of India, PNB hike home loan interest rates: Check latest rates here
Loan amount
Most lenders offer housing loans ranging from 75 to 90 percent of the cost of the property, depending on the loan amount, as defined by the regulator. Depending on your house loan eligibility, if the property is evaluated at Rs 50 lakh by the lender, you can get a maximum loan of Rs 40 lakh (80% of the property cost for a loan amount up to Rs 75 lakh).
Pre EMI
Pre-EMI is a term that refers to a loan that is being taken out on a property that is still being built. In this instance, your loan is disbursed in stages dependent on the quantity of instalment payments you must make to the developer. According to , “You are generally required to start paying only the interest on the loan amount disbursed (called the pre-EMI interest). In case you wish to start principal repayment immediately, you may opt to tranche the loan and start paying EMIs on the cumulative amounts disbursed.”
now!Read More News on
(Your legal guide on estate planning, inheritance, will and more.)
Download The Economic Times News App to get Daily Market Updates & Live Business News.
