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SBI Home Loan: If you have also taken home loan from State Bank of India, then there is good news for you. Now your loan EMI can be reduced. Actually, the bank is offering all its old customers the opportunity to switch to home loan external benchmark rate (EBR). This can provide great relief to customers. However, to switch to EBR you have to pay a fee. Along with this, SBI is also offering a special discount of 0.05 per cent in interest rates to women. Let us know that those who had taken loans on MCLR or Base Rate before 2018, they are paying more EMI even today.
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What is EBR switch option
Let us tell you that earlier almost all banks used to lend at MCLR or Base Rate, but nowadays according to the Reserve Bank, banks are offering loans at floating rates only on external benchmark linked rates (EBR). EBR and repo rate are directly linked to RBI. In such a situation, as soon as the Reserve Bank changes the repo rate, its effect starts to appear on the rate of your home loan from the next quarter. This reduces your incoming EMI or increases it.
EBR, MCLR, difference in base rate
The difference in EBR, MCLR, base rate can be seen. Currently, SBI’s EBR linked home loan rates are 6.70 per cent. On the other hand, if you talk about MCLR linked home loan rates then it starts from 7.45%. Whereas, base rate linked home loan rates start from 7.85%. Home loan is taken for long term only. In this case, the difference in nominal interest rates can have a great impact on your EMI. Therefore, switching home loan to EBR can be a profitable deal for you.
How to switch
If you also want to switch your SBI home loan to EBR, then you can contact your branch. For this, you have to submit a form in the bank. For this, you have to pay a fee of Rs 5000 + GST.