The state-run lender said that for home loans valued Rs. 30 lakh and above, the bank will offer preferential pricing to customers with good credit score. In a statement the bank said, customers with CIBIL score of 760 and above will be able to secure home loan at the marginal cost-based lending rate (MCLR) for a year. MCLR is the minimum rate of interest below which the bank is not allowed to lend.
For other customers with credit score of 759 and less, the rate of interest for home loans of Rs 30 lakh and above will be MCLR rate plus 0.10 bps for a year. One basis points is 100th of a percentage point.
The CIBIL score ranging between 300 and 900 summarizes the borrower's repayment history together with past credit behavior.
Also, higher the CIBIL score, more shall be the chances of loan approval. Banks as a usual practise check upon the customer's Credit Information Report and CIBIL score.
In a statement the bank said, "Consumers with a good credit discipline should be rewarded, as it helps propagate the importance and need to maintain a good financial history. Our preferential pricing model aims to reward high-scoring home-loan aspirants with competitive ROI, thereby helping them making their dream home a reality".
On the announcement of lowered interest rates for individuals with good credit score, PTI cited Credit information company TransUnion CIBIL's Head of Direct to Consumers Interactive Hrushikesh Mehta, as saying, "Bank of India's CIBIL score-based incentive helps further highlight the need to monitor and build a positive credit profile through good credit habits.".
With PTI Inputs