Good news: After SBI, now these banks also made loans cheaper, you will benefit..

Union Bank of India and PNB Housing Finance have also given relief to customers following the announcement of a cut in the Marginal Cost of Fund Based Interest Rate (MCLR) by the country’s largest state-run State Bank of India (SBI).  Union Bank of India has reduced this so Union Bank of India has reduced the Marginal Cost of Funds (MCLR) based lending rate by five to 15 basis points for all periods. This is the 11th consecutive cut in the rate announced by the bank since July 2019. The new rates will be effective from 11 May 2020.
Period  MCLR 
Overnight MCLR 7.15%
1 month MCLR 7.15%
3 month MCLR 7.40%
6 month MCLR 7.55%
1 year MCLR 7.70%

PNB Housing Finance, being implemented from today, has announced a new rate home
loan company PNB Housing Finance has reduced the loan rates for existing customers by 0.15 per cent. This deduction will be for both personal housing loans and property-acquired loans. The loan rate cut has come into effect from 9 May. 

The bank said in a statement that the deduction will be available to all existing retail customers who have taken loans at floating rate before February 2020. PNB Housing Finance Managing Director and CEO Neeraj Vyas said, ‘We have taken this step to provide relief to customers during the current Kovid-19 crisis. This will also help in growth in the housing sector. This will benefit 2.35 lakh customers, irrespective of the principal amount of their loan. The company provides housing and non-housing loans to its retail customers. Apart from this, the company also lends construction to real estate developers.

SBI had
first lowered the loan. Earlier on May 7, SBI also announced a reduction in MCLR. After the cut, the one-year MCLR has come down from 7.40 per cent to 7.25 per cent. It was reduced by 15 basis points, which would greatly benefit the customers. The new rates will be applicable from 10 May 2020. 

Customers will 
know that SBI has cut MCLR for the 12th consecutive time in the current financial year. This will greatly benefit the customers. This is because the EMI of their home loan will decrease. However if your home loan is linked to SBI’s MCLR rate, the new deduction may not bring your EMI down immediately, as MCLR based loans usually have a one-year reset clause. Explain that MCLR rates are based on the bank’s own cost. 

Home loan will be so cheap
In this context, SBI said that if you have taken a loan of Rs 25 lakh for a period of 30 years, which is MCLR based, the EMI of your home loan will be reduced by about Rs 255.
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