Whether employed or unemployed, we all have an important personal finance goal in our life that is purchasing a home or constructing a new house. But when it comes to home loans, a question arises in our mind: from where to get funds or home loans and how to pay EMI or what will be the EMI. But let me first make you very clear about a home loan in short that it is an amount or fund that you take from the bank against your property which here acts as collateral to the bank. Coming to the EMI part, it is the monthly amount that you repay the bank or company against your loan amount. A monthly EMI is determined by principal loan amount, applicable interest rate and loan tenure. As long as taking a home loan is concerned, an individual i.e. a self-employed or salaried will must go with leading banks. And among the leading banks of our country, no doubt that the State Bank of India (SBI) will come first to our mind. So if you are a borrower and want to take a home loan from SBI, then this article is only for you.
Documents required for SBI home loan
Below are the required documents according to the website of SBI that you need to apply for a home loan:
Identity proof: Employer Identity Card, loan application form along with 3 passport size photographs, proof of identity and proof of residence.
Property documents: Construction permit, allotment letter/stamped agreement for sale, occupancy certificate, maintenance bill, electricity bill, property tax receipt, approved plan copy, registered development agreement of the builder, conveyance deed (For New Property), and bank account statement of the last 6 months and loan account statement for last 1 year (if any).
Income proof (for salaried individuals): Salary proof of last 3 months and Form 16 for last 2 years,
Income proof (for self-employed individuals): Business address proof, IT returns for last 3 years, balance sheet & profit & loss statement for last 3 years, business license, TDS certificate or Form 16A, certificate of qualification (for C.A./ Doctor and other professionals).
Eligibility required for SBI home loan
Before applying for a home loan in SBI, you need to meet the below-listed criteria:
- You must be a resident Indian.
- You must fall under the age limit of 18 years to 70 years.
- You can apply for a loan tenure up to 30 years
Key details of SBI home loan
- SBI home loan products can be availed by any kind of individual whether it’s salaried, non-salaried or an existing employee.
- Low-interest rates and processing fees on home loans as opposed to other banks and NBFCs.
- SBI home loan products do not have hidden charges and prepayment penalty.
- Interest rates on SBI home loans are applicable on a daily reducing balance.
- Overdraft facility on home loans is also provided by SBI.
- Interest rate concession for women applicants and if applied via YONO app.
SBI home loan interest rates and consolidated processing fees
Affordable interest rates on home loans beginning at 6.80% p.a. are available from 1 June 2021 at SBI. The interest reduction of 0.05 per cent on SBI Home Loans also is granted to women borrowers. No hidden charges and a 100% exemption from prepayment makes SBI home loan products more attractive. A concession of 5-bps will also apply to those who will apply for an SBI home loan via SBI YONO app. A consolidated processing fee of 0.40% of the loan amount and the applicable GST shall be imposed under Rs. 10000/- minimum and Rs. 30,00/- upper limit. That being said a 0.40% of the amount of loan is subject to a maximum recovery of Rs. 10000/- plus the applicable charge, for builders tie projects that do not need individual TIRs and valuations. And, where TIR and evaluation are necessary, SBI will apply to regular charges as stated, according to SBI.
SBI Home Loan EMI Calculation
It is a smart idea to evaluate if you can afford the monthly instalments before you take a home loan from any bank. Home Loan Calculator is the best method to accomplish this. Simply input the loan amount, the tenor of the loan, and the bank’s applicable interest rate. With SBI, you can determine your EMI, monthly interest and monthly reducing balance based on the principal amount, loan tenure, and interest rate using the SBI Home Loan EMI calculator. But apart from using an online home loan calculator, you can also use a basic formula to calculate your monthly EMI. The formula for EMI calculation is EMI = [P x R x (1+R)^N]/[(1+R)^N-1], where P is the principal amount, R is the rate of interest on a monthly basis, N is the number of tenure in months.
The Reserve Bank of India (RBI) agreed to retain the repo and reverse repo at 4 per cent and 3.35 per cent, respectively, at its bi-monthly monetary policy review meeting on Friday (June 4). Since the RBI opted to maintain an unchanged repo rate, it is doubtful that the rates for home and other repo-related loans would rise eventually. Those who want to take new loans can stick to current low rates as ongoing inflation patterns may push RBI to revise the key rates at the upcoming policy review meeting.