SBI is the latest bank to raise its lending and deposit rates after the Reserve Bank of India (RBI) raised the repo rate by 50 basis points to 4.90 percent last week. The minimum interest rate for home loans has been raised to 7.55 percent by the bank.
With the most recent increase, the minimum rate for a borrower with a credit score of more than 800 under the standard home loan scheme is now 7.55 percent.
The lender has also increased its External Benchmark-based Lending Rate (EBLR) to a minimum of 7.55 percent, up from 7.05 percent previously, according to the bank's website. However, depending on the credit score, a risk premium will be added.
SBI has revised the marginal cost of fund-based lending rates (MCLR) by up to 0.20 percent with effect from June 15, 2022. The benchmark one-year MCLR rate has been raised from 7.20 percent to 7.40 percent.
The MCLR is linked to the majority of consumer loans, including auto, home, and personal loans.
Regular home loans have a minimum interest rate of 7.55 percent for borrowers with a credit score of 800 or higher. In this case, the risk premium is nil. The risk premium is determined by the CIBIL score; the lower the credit score, the higher the risk premium rate.
A credit score of 750 to 799 will result in an interest rate of 7.65 percent, with a risk premium of 10 basis points. These loans will be discounted by 0.05 percent for female borrowers.
Once the reset date arrives, borrowers will be required to pay higher interest rates on their loans, i.e. higher EMIs, or have their loan tenure extended if possible. If you have an SBI home loan, the table below shows how much your EMI would increase as a result of the recent interest rate increase.
