Canara Bank has introduced a new home loan scheme, which has provision for fixed as well as floating interest rates. The scheme aims at clearing uncertainties regarding payment of EMI during the whole life of the loan. SBI and several other banks have recently revised their home loan interest rate by freezing the rate for the first year only.
The scheme by Canara Bank goes one step further, as it offers a fixed rate for the first five years and a floating rate of two percentage points below the benchmark prime lending rate for subsequent years. For home loans up to Rs 30 lakh, borrowers would have to pay a fixed rate of 8.25 percent in the first year and from the second to the fifth year, a fixed rate of 9.25 percent would be payable. At the end of the fifth year, borrowers would by charged a floating rate 200 basis points below the benchmark prime lending rate prevailing at the time of payment. | 
