Big Relief for Home Loan Borrower
Good News for the middle class family, those having existing Home Loan and want new Home Loan. As we Know RBI already reduced the Repo rate by 0.25 paisa. After this announcement some of bank also reduced the interest rate of Home loan this will be applicable for existing home loan customer and for new customer. Here are the details, I am going to share with you please read and also visit the branch and website of the bank to check the details.
The Reserve Bank of India (RBI) lowered the repo rate by 0.25% (25 basis points) in its Monetary Policy Committee (MPC) meeting on February 7, 2025. The new repo rate is now 6.25%, after staying the same for almost two years.
Following this, several banks like Canara Bank, PNB, Union Bank of India, and Bank of Baroda also reduced their repo-linked lending rates by 0.25%. This means home loan borrowers from these banks can either reduce their monthly EMIs or keep the EMI the same and shorten their loan period.
Repo Linked Lending Rate (RLLR) is the interest rate that banks charge customers for loans, based on the repo rate set by the Reserve Bank of India (RBI). When a loan’s interest rate is tied to the repo rate, it is called an RLLR-linked loan.
Since October 2019, the RBI has required banks to link their retail loans to external benchmark lending rates (E-BLR). As a result, most banks now use the repo rate as their benchmark.
If a customer takes a home loan linked to RLLR, the interest rate will change whenever the repo rate changes. Most home loan borrowers choose a floating interest rate, meaning their loan rates are directly connected to RLLR and will rise or fall based on the repo rate.
Banks Reduce Home Loan Rates after RBI Cuts Repo Rate
The impact of the reduced Repo Linked Lending Rate (RLLR) will be different for old and new home loan borrowers. Most banks have quickly passed the benefit to new borrowers, while old borrowers will receive the lower rates based on their loan reset cycle.
Latest RLLR Changes by Major Banks:
Canara Bank:
Reduced RLLR from 9.25% to 9.00%. This new rate applies to loans opened on or after February 12, 2025, and existing loans completing 3 years under RLLR from this date.
Bank of Baroda
Reduced Baroda Repo Linked Lending Rate (BRLLR) to 8.90% from February 10, 2025 (RBI Repo Rate 6.25% + 2.65% MarkUp).
Bank of India
Lowered RLLR from 9.35% to 9.10%, effective February 7, 2025.
Union Bank of India
Cut RLLR from 9.25% to 9.00%, effective February 11, 2025.
Indian Overseas Bank (IOB)
Reduced RLLR from 9.35% to 9.10%, effective February 11, 2025.
Punjab National Bank (PNB)
Lowered RLLR from 9.25% to 9.00%, effective February 10, 2025.
These rate cuts follow the Reserve Bank of India’s decision to lower the repo rate by 25 basis points (bps), from 6.50% to 6.25%.