How does it work?
When you take a home loan under SBI Maxgain, State Bank of India (SBI) will offer you an overdraft of an amount equivalent to your home loan. As and when there is a surplus in the SBI Maxgain Account it is treated as payment of your loan (as in the case of overdraft) and hence your interest burden starts getting reduced.
Say you have a sum of Rs 15 lakhs as an outstanding home loan payment under the SBI Maxgain. Now, if you have Rs 2 lakhs in your SBI Maxgain account, then it will be treated as a credit and your interest rate burden will stand reduced. Interestingly, since this account operates like a current account, one can avail of cheque book/ATM-cum-Debit Card/net banking facility for the purpose.
The interest rates under the SBI Maxgain are slightly higher then the interest rates SBI offers on its home loans. Currently, the floating rate of interest offered by SBI on its home loans if 9.95 per cent. Under Maxgain you would have to pay an interest of 0.25 per cent extra. This is for an amount under Rs 1 crore. The Minimum loan amount sanctioned under the SBI Maxgain is Rs 5 lakhs, while there is no upper limit.
Presently, the processing fee is the same as that of State Bank of India Home loans.
SBI Maxgain is a decent product, if you are looking at reducing your interest burden and are confident that you would be able to generate at least some surplus saving every month.