Loan Ratio – Regiofora http://regiofora.com/ Fri, 09 Jul 2021 07:42:08 +0000 en-US hourly 1 https://wordpress.org/?v=5.8 https://regiofora.com/wp-content/uploads/2021/07/icon-5-150x150.png Loan Ratio – Regiofora http://regiofora.com/ 32 32 The lowest interest rates on home loans under Rs 30 lakh: here’s what 15 banks are offering https://regiofora.com/the-lowest-interest-rates-on-home-loans-under-rs-30-lakh-heres-what-15-banks-are-offering/ https://regiofora.com/the-lowest-interest-rates-on-home-loans-under-rs-30-lakh-heres-what-15-banks-are-offering/#respond Fri, 09 Jul 2021 05:34:00 +0000 https://regiofora.com/the-lowest-interest-rates-on-home-loans-under-rs-30-lakh-heres-what-15-banks-are-offering/ Borrowers can contact their banks to convert their loans to the new scheme or refinance their loan with another lender after carefully assessing the costs of refinancing and the potential savings on interest. The Reserve Bank of India’s decision to keep the repo rate unchanged at a low of 4% for over a year has […]]]>
Borrowers can contact their banks to convert their loans to the new scheme or refinance their loan with another lender after carefully assessing the costs of refinancing and the potential savings on interest.

The Reserve Bank of India’s decision to keep the repo rate unchanged at a low of 4% for over a year has helped many banks cut interest rates on fixed deposits, demoralizing investors . However, this downward trend in pensions has also led many banks to cut their floating interest rates on home loans to decades-long lows, especially since October 2019, when the central bank ordered all banks. to compare their loans externally.

In fact, there are currently at least 15 banks that offer home loans starting at less than 7% per annum. Compare that to September 2019, when the lowest mortgage rates were around 8.40% per annum. , having the necessary margin funds, a credit score above 750, and adequate repayment capacity, this could indeed be the perfect time to make your home buying dreams come true, according to BankBazaar.

The current phase of low interest rates on home loans, especially by banks that have compared their loans to the RBI repo rate, also offers an opportunity for borrowers who are managing home loans under the MCLR or rate scheme. (i.e. for loans taken out before October 2019) to refinance their loans into repo-linked loans to take advantage of lower rates and save on the outflow of interest.

Borrowers can contact their banks to convert their loans to the new scheme or refinance their loan with another lender after carefully assessing the costs of refinancing and the potential savings on interest.

Note, however, that the loans linked to pensions will experience a rapid and proportional increase whenever the central bank decides to increase the rate of pensions. These loans also involve customer risk extending beyond the repo rate and the bank spread which could be triggered if the borrower’s credit rating suffers a substantial decline during the life of the loan, resulting in a higher applicable interest rate and EMI amount, according to BankBazaar.

So, if you are planning to take out a home loan for less than Rs 30 lakh, here is a list of the top 15 government and private banks that currently offer the lowest interest rates. Note that the interest rate that is applicable to you would be determined according to your age, your income, your gender, your credit rating, the amount of the loan, the loan / value ratio or any other condition of the lender. you have chosen.

15 Best Banks Currently Offering Lowest Interest Rates On Home Loans Under Rs 30 Lakh

Disclaimer: Interest rates that vary with tenure terms or credit scores in the specified loan amount are shown as a range, and banks have been listed in ascending order based on their current mortgage rates for loans below Rs 30 lakh. Data taken from the banks’ respective websites on July 2, 2021.

Data compiled by BankBazaar.com, an online marketplace for loans, credit cards and more.

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Lenders say no to businesses and individuals as India’s economy needs credit the most https://regiofora.com/lenders-say-no-to-businesses-and-individuals-as-indias-economy-needs-credit-the-most/ https://regiofora.com/lenders-say-no-to-businesses-and-individuals-as-indias-economy-needs-credit-the-most/#respond Fri, 09 Jul 2021 03:22:00 +0000 https://regiofora.com/lenders-say-no-to-businesses-and-individuals-as-indias-economy-needs-credit-the-most/ Risk-averse Indian lenders are emerging as one of the biggest obstacles to the speed of the country’s recovery from the pandemic-induced downturn, as they withhold credit when the economy needs it most. Loans to businesses and individuals have grown at a moderate pace of 5.5% to 6% in recent months, half the pace seen before […]]]>

Risk-averse Indian lenders are emerging as one of the biggest obstacles to the speed of the country’s recovery from the pandemic-induced downturn, as they withhold credit when the economy needs it most.

Loans to businesses and individuals have grown at a moderate pace of 5.5% to 6% in recent months, half the pace seen before the pandemic, according to data from the Reserve Bank of India. The State Bank of India, the country’s largest lender, wants to almost double its credit growth rate to 10% in the year that started April 1, but is poised to miss the target.

“It is a very fragile situation,” said Dinesh Khara, chairman of the SBI, after releasing the results of the exercise ended in March. The bank would not “compromise” on asset quality to meet its targets, he said.

Khara’s comments highlight the biggest obstacle to both credit underwriting and economic growth, set at 9.5% this year, already reduced from previous central bank forecast of 10.5% and more to an unprecedented contraction last year. Banks’ risk aversion – or fear of bad loans in a tough economic environment – could further slow the economic recovery, analysts, including those at the RBI, say.

“Credit is a necessary and possibly the most important ingredient of economic growth,” according to SS Mundra, former deputy governor of the RBI, who estimated that the multiplier effect of credit on nominal gross domestic product growth is 1 ,6 times.

It doesn’t help India’s case that it is already home to one of the biggest piles of bad loans among major economies. And add to that a crisis in shadow banking, which has resulted in the rescue of two lenders and the bankruptcy of two more in the past two years.

The RBI expects the bad debt ratio of banks to rise to 9.8% by the end of this fiscal year, from 7.48% a year ago.

Slow capex

While banks procrastinate on loans on the one hand, companies are pushing back their investment plans in the face of lack of demand on the other.

Business willingness for new investment is low, according to the Center for Monitoring Indian Economy Pvt., With capital spending on the decline. While companies recorded windfall profits mainly from widespread cost reductions, most used the additional funds generated to repay bank loans.

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According to a SBI study, where economists analyzed the top 15 sectors and a thousand listed companies, more than 1.7 trillion rupees ($ 22.8 billion) in debt was reduced last year. Refineries, steel, fertilizers, mining and mineral products as well as textile companies alone have reduced their debt by more than 1.5 trillion rupees, the trend continuing this year, the economist wrote recently in head of the bank, Soumya Kanti Ghosh.

“Any significant recovery beyond 10% growth in credit demand will require a substantial turnaround in the private investment cycle, which still seems far away as companies focus on deleveraging,” said Teresa John, economist at Nirmal Bang Equities Pvt. in Bombay. It predicts 7% GDP growth this year, which is in the lower end of a Bloomberg survey with a consensus of 9.2%.

What Bloomberg Economics Says …

“A further slump in credit growth means the RBI should allow a bit more time for credit recovery before it begins to unwind its stimulus.”

– Abhishek Gupta, Indian economist

Consumers are also fixing their finances, which does not bode well for the aggregate demand for goods and services as well as for personal loans, and therefore for economic growth. The current recovery is likely to be less abrupt than the rebound that occurred in late 2020 and early 2021, analysts at S&P Global Ratings say.

“Households are depleting their savings,” S&P analysts wrote. “A desire to replenish their cash flow may delay spending even as the economy reopens.”

And while Covid-19 relief measures may provide some respite for banks, the need to raise capital will remain high once stress from the virus begins to show up on their balance sheets.

“Challenges for Indian banks posed by the coronavirus pandemic have increased due to a virulent second wave,” said Saswata Guha and Prakash Pandey of Fitch Ratings this week, as they cut India’s growth forecast from 280 basis points to 10%. This underscores “our belief that the renewed restrictions have slowed recovery efforts and left banks with a moderately worse outlook for business and revenue generation.”

–With help from Suvashree Ghosh.

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