Several banks like the State Bank of India (SBI), Kotak Mahindra, Bank of Baroda (BoB), Punjab National Bank (PNB) and HDFC are offering loans at record interest rates to take advantage of the rush to spend before the Christmas and New Year. season.
SBI will charge mortgage borrowers 6.7% interest based on their credit score regardless of the loan amount. The offers are accessible to all segments of borrowers regardless of the profession of the borrower. The 6.70% mortgage offer is also applicable to cases of balance transfer.
Kotak Mahindra Bank cut interest rates on home loans by 15 basis points (bps), from 6.65% to 6.50%. This special rate is a limited offer for the holiday season starting September 10 and ending November 8. BoB offers a 0.25% exemption from existing applicable rates for home and auto loans. In addition to this, the bank also offers a mortgage processing fee waiver. From now on, mortgage rates will start at 6.75% and auto loan rates will start at 7%.
The PNB also reduced the pension-based lending rate by 25 basis points (bps) to 6.55%.
HDFC has announced a festive offer with mortgage loans starting at 6.7%. This offer will be applicable to new applications regardless of the amount or the job category. The special 6.7% offer applies to all loan brackets and to all customers with a credit score of 800 and above.
Real estate experts believe these interest rate cuts could be a major factor in boosting home sales this holiday season.
“It’s an encouraging move by the major banks to cut interest rates, especially at the start of the holiday season. Even now, a low interest rate charged by reputable banks is expected to catapult unimaginable economic growth in the country due to increased consumption. The initiative will surely make home ownership affordable and viable for fence guards who can now grab the best opportunity to purchase their dream home, ”said Vedanshu Kedia, Director of Prescon Group.
According to Cherag Ramakrishnan, Managing Director of CR Realty, “With the auspicious holiday season ahead, the timing of the major banks’ interest rate cuts couldn’t have been better. The real estate market has had decent sales this year and this drop in interest rates would help keep sales momentum even further.
Bhushan Nemlekar, Director of Sumit Woods Ltd, said: “The reduction in mortgage rates by major banks will help demand tremendously. The real estate sector has benefited enormously from record low mortgage rates. Currently, historically low interest rates of less than 7% encourage consumers to complete their purchase and close transactions quickly. Low interest rates also help improve homebuyer eligibility, which in turn attracts more customers to the market. “
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