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SBI, HDFC Offer Home Loans At 8.40% As Part Of Festive Sales

The bank had crossed the Rs 5 lakh crore-mark home loan mark in January 2021.

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Despite rising interest rates, leading home loan players SBI and HDFC have announced discounted interest rates beginning at 8.40% as part of their festive offerings.

SBI in a statement said that its home loan book has topped the Rs 6 lakh crore mark, a first in the industry. The leading lender said it is offering up to 25 bps discount on interest rate to new home loan borrowers, making the entry level rate at 8.40% and the offer will run up to Jan. 31, 2023.

The largest pure-play mortgage player HDFC, which is awaiting its merger with its banking subsidiary HDFC Bank, said it's also offering discounted interest rates to new borrowers to the tune of 20 bps or at 8.40%.

According to HDFC website, the festive offer is valid up to November 30, and the low rate will be applicable to those borrowers who have a minimum credit score of 750.

Leading banks and mortgage players have increased their lending rates by up to 0.50% point after the Reserve Bank of India last raised its repo rate by 50 bps to tame inflation.

State Bank of India did not offer details such as the credit score conditions or the ticket size of the loan to avail of the lower rates.  It further said the festive offer also includes waiver of the processing fees, balance transfers/takeovers and top-up loans.

The bank had crossed the Rs 5 lakh crore-mark home loan mark in January 2021.

SBI said while the new loan comes up to 0.25% point lower than its existing rates, new top-up loans will be 0.15% point cheaper, and loans against property will be cheaper by 0.30% point. None of these offerings will have processing fees.

Commenting on the milestone, chairman Dinesh Khara said SBI has over 28 lakh home loan customers.

Alok Kumar Choudhary, the managing director-retail banking & operations, said, while interest rate for new loan buyers and loan takeovers starts at 8.40% and top-up loans start at 8.80%.

Meanwhile, HDFC told PTI that its retail home loan book stood at Rs 5.363 lakh crore in the June quarter and its non-individual loan book at Rs 1.351 lakh crore, taking the overall AUM to Rs 6.714 lakh crore. The mortgage lender has not disclosed the Q2 numbers yet.

Earlier in the month, HDFC had said it sold individual loans worth Rs 34,513 crore in the second quarter, up from Rs 27,199 crore, closing its gap with SBI to just about Rs 29,187 crore.