SBI home loan processing fees: SBI may charge processing fees on home loans, recharge plans

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SBI home loan processing fees: SBI may charge processing fees on home loans, recharge plans

SBI Home Loan Processing Fees: India’s largest lender, State Bank of India (SBI) is likely to charge processing fees for mortgage borrowers, recharge plans, and business and homebuilder loans. The move comes as the bank faces a sharp drop in interest income after the RBI cut repo rates.

According to the TOI report, the SBI, in an internal circular, informed that the full exemption from consolidated processing fees, which was to last until the holiday season until December, has been withdrawn.

The “Full Consolidated Processing Fee Waiver” offered during the festival period for loan proposals coming through December 31, 2019 is withdrawn. “The waiver will continue for proposals coming through October 15, 2019,” SBI said.

On July 1, 2019, SBI linked its borrowing rate to the repo benchmark rate. Before that, SBI offered the lowest rate on the market. After the decision to tie, rates fell sharply, a source told TOI.

The processing fee would be close to 0.4%, which on average for individual borrowers would be between Rs 10,000 and Rs 30,000 (minimum-maximum). For builders, a flat-rate charge of Rs 5,000 has been reintroduced, a source told the newspaper.

On July 1, 2019, the SBI launched software that automatically pegs mortgage loans at the dynamic moving rate, which fell on August 1, 2019. On October 1, it rolled out another software that pegs loans at the RBI benchmark rate. .

Other costs such as prepayment charges and registration fees in the Central Asset Securitization Register and collateral registration fees are also likely to be increased at a later stage.

READ ALSO: SBI cuts rates on non-repo loans by 10bp

ALSO READ: SBI will adopt repo rate as external benchmark for all variable rate loans from October 1

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