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BT Buzz: Are home loans with shorter reset under MCLR beneficial for you?

MCLR-linked home loans come with a reset period of one year, which SBI has reduced to six months. Although it is wise to go with the reduced reset period, there could be some pitfalls

 
 

Under restructuring, moratorium should be the last resort as it adds to your interest burden; increasing tenure or reducing EMI could be better options

While some borrowers get benefits of repo rate cuts quickly, others have to wait longer depending upon the tenure and regime of their loan
The crisis served as a wake-up call for banks whose digital operations were growing at a snail's pace. They have started embracing the change
 
 

EMI of your loan consists of two parts -- interest amount and principal repayment

Bank home loan interest rates: The reduction in MCLR for shorter tenor - up to three months - is aimed at boosting credit offtake and revive demand

The one-year MCLR, to which a majority of loans such as residential mortgages and auto loans are tied now stands at 7.70 per cent
The loan moratorium has now been extended till August 31 for 6 months owing to continuing  disruptions  on account  of  coronavirus crisis
Observing the need gap, two start-ups LazyPay and Spocto have launched products that will help you figure if you require the moratorium or not
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