Big news for SBI customers. Especially if you are taking a loan from this bank then today’s article is for you. The State Bank of India (SBI), the biggest bank in the country, has just made things easier for home loan borrowers. They’ve lowered their home loan interest rate by 25 basis points to 8.25%, effective from February 15, 2025. This move comes after the Reserve Bank of India (RBI) recently slashed the repo rate by the same amount, bringing it down from 6.50% to 6.25% in their latest meeting. Additionally, SBI has also reduced the External Benchmark-Based Lending Rate (EBLR) and Repo Linked Lending Rate (RLLR).
Let’s break down the EMI calculations:
Current EMI:
– Loan amount: Rs 50 lakh
– Loan tenure: 20 years
– Interest rate: 8.50% annually
– EMI: Rs 43,391
– Total interest over the loan period: Rs 5,413,879
– Total payment: Rs 10,413,879
New EMI after the rate cut:
– Loan amount: Rs 50 lakh
– Loan tenure: 20 years
– Interest rate: 8.25% p.a. (after the 0.25% reduction)
– EMI: Rs 42,603
– Total interest over the loan period: Rs 5,224,788
– Total payment: Rs 10,224,788
So, what does this mean for your EMI and interest? With the 0.25% interest rate drop, your EMI will go down by Rs 761. Plus, if the interest rates stay the same for the next 20 years, you’ll save Rs 189,091 in total interest over the life of the loan.