State Bank of India keeps its home loan rates unchanged. Here’s how to check your applicable interest rate

The country's largest bank, State Bank of India (SBI) has recently tweaked its marginal cost of lending rates (MCLR) even though many banks have revised their lending rates.

SBI has kept its overnight MCLR rate unchanged at 7.90 per cent, the rate for one-month and three-month tenure is 8.10 per cent.

The six-month MCLR is 8.40 per cent, while its one-year MCLR is 8.50 per cent. For tenure of two years and three years, the lending base rate has been fixed at 8.60 per cent and 8.70 per cent, respectively. These rates are effective from May 15, 2023.

Banks, including SBI, ICICI Bank, Union Bank, Bank of Baroda, have kept their MCLR rates unchanged after the Reserve Bank of India kept its repo rate unchanged in its April monetary policy meet.

After hiking the policy repo rate cumulatively by 250 basis points from 4 per cent to 6.50 per cent since May 2022, the MPC hit the pause button at its last meeting in April. The central bank's MPC will hold its bi-monthly deliberations on June 6-8, 2023.

Source: SBI website

How are home loan rates calculated?

The SBI home loan rates depend on the loan applicant’s credit scores. Credit scores are kind of a marking that rates a consumer's creditworthiness. The higher the score, the better a borrower looks to potential lenders. If the credit score is low, the bank imposes a risk premium. The worse the credit score, the higher will be the risk premium.

For loan applicants with credit scores of 750 or higher, the regular home loan interest rate is 9.15 per cent (EBR+0 %). No risk premium is applied in this situation.

For Cibil Score between 700-749, applicable home loan rate is 9.35 per cent. The risk premium under this bracket is 20 bps.

For Cibil score between 650-699, the bank is offering 9.45 per cent home loan rate.

For Cibil Score between 550-649, the bank’s home loan rate is 9.65 per cent.

Last year in October, the largest lender said its home loan book surpassed the Rs 6-lakh-crore mark, making it the largest in the industry. The bank, with 28 lakh home loan customers, had crossed the Rs 5 lakh-crore mark in January 2021, the bank said in a statement, adding it is the first lender to achieve the Rs 6 lakh crore milestone in the residential home category.

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