SBI's step to freeze home loans at 8 percent for one year will have no impact on the market leader HDFC, which still offers lower overall interest cost to borrowers. A brokerage firm Edelweiss Securities said in its analysis report.
The SBI scheme has a provision of 8 percent interest rate for the first year only. From the second year onwards, the rate would increase to 10.25 percent for loans up to Rs. 30 lakh and to 10.75 percent for loans more than this amount. The average interest rate for a loan of Rs 30 lakh taken from SBI for a period of 20 years would stand at 9.92 percent, while the current rate of interest for a similar loan taken through HDFC would cost 9.97 percent per year to the borrowers.
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