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Loan interest rates rising, but a good CIBIL score can still fetch you a better deal
Private sector HDFC’s Retail Prime Lending Rate (RPLR), on which its Adjustable Rate Home Loans (ARHL) are benchmarked, has gone up by 5 basis points, with effect from June 1. With this 5 bps increase, the total hike in interest rate will be 40 bps for HDFC home loan borrowers. One basis point is one-hundredth of one percentage point.
Private sector lender ICICI Bank also revised the marginal cost of funds-based lending rate with effect from June 1, 2022, according to its website. State-run Bank of India also raised marginal cost of funds-based lending rate on some tenor with effect from June 1, 2022.
In case of SBI, under regular home loans, for a credit score above or equal to 800 – the interest rate will be lowest at 7.05% with a max gain of 7.45%. Between 750 – 799 credit scores, the interest rate is 7.15%, while on 700-749 credit scores – the interest rate is 7.25%. For credit scores 650-699, the interest rate will be 7.35%, whereas on credit scores of 550-649 – the rate is 7.55%. For NTC/ no CIBIL score, the interest rate is 7.25%. Except for CIBIL score of above or equal to 800, the max gain in regular home loans is the same as the interest rate.
The lower your credit score is, the higher will be the interest rate charged on your home loans and vice versa. Notably, the CIBIL score gives a view of how well a borrower manages his or her credit, while also showing the ability of the borrowers to opt for loans and repay them.
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