SBI Home Loan Interest Rates: With the onset of May month, the interest rates offered by the largest PSU lender, State Bank of India (SBI) have also undergone a major revision. As per the latest update, SBI has trimmed its lending benchmark rates by 25 bps after RBI's repo rate cut in April policy. The new rates offered by SBI make EMIs cheaper especially on home loans. These rates are in effect from April 15, 2025, and continue at the start of May as well.
SBI Lending Rates:
SBI External Benchmark-based Lending Rate:
With effect from April 15, SBI's external benchmark lending rates have been revised by 25 basis points. Now, the external benchmark lending rate (EBLR) has a rate of 8.65+CRP+BSP compared to earlier 8.90+CRP+BSP.
Further, the repo repo-linked lending rate (RLLR) is revised to 8.25+CRP from earlier 8.50+CRP.
The full form of CRP is a credit risk premium, while the full form of BSP is a Billing and Settlement Plan (BSP).
SBI MCLR Rates:
However, with effect from April 15, SBI has kept its MCLR rates unchanged. This is also because majority of loans are now linked with external benchmarks.
From October 1, 2019, RBI introduced external benchmark lending rates including linking lending rates with policy repo rates. And directed the scheduled commercial banks to transmit to external benchmarks since MCLR did not deliver effective transmission of monetary policy. However, existing loans and credit limits linked to the MCLR/Baserate/BPLR will continue till repayment or renewal, as the case may be.
Currently, the 1-year MCL rate is 9.00%, while 2-year and 3-year MCLR rates are 9.05% and 9.10% respectively. MCLR rates from overnight to six months, range from 8.20% to 8.90%.
SBI External Benchmark Rate (EBR):
From April 15, SBI is offering minimum lending rate benchmark of 8.65% which is a mixture of repo rate of 6% and 2.65% spread.
SBI Base Rate, BPLR:
SBI has not revised its base rate of 10.40% and BPLR of 15.15% per annum since March 15, 2025, and hence, these rates will continue even in May 2025.
SBI Home Loan Interest Rates:
Since SBI revised its lending benchmark rates, its home loan interest rates are revised accordingly. With effect from April 15, SBI is offering 8% to 8.95% on regular home loans, while the rate is between 8.25% to 9.15% on home loan max-gain overdraft scheme.
Further, the home loan rates are 8.30% to 10.80% on top-up home loans, between 8.50% to 9.45% on top-up overdraft home loans, while the rates range from 9.50% to 10.80% on loans against property.
The reverse mortgage loan has an interest rate of 11.05%. while SBI is offering 8.85% rate on YONO Insta Home Top Up Loan.
All these loans are linked to EBLR.
Here's how to calculate SBI Home Loan EMIs.
As per the SBI website: the Home Loan EMI calculator is a basic calculator that helps you to calculate the EMI, monthly interest and monthly reducing balance based on principal amount, loan tenure and interest rate.
For example, let's take a regular home loan of Rs 75 lakh for a tenure of 15 years. Using the highest rate of 8.95% under this category, the home loan EMIs will be at Rs 75,847. The total interest payable over the loan term will be at Rs 6,152,474, while the total payments made over the loan term will come around Rs 13,652,474.
(Image Source: SBI Home Loan EMI Calculator)
On the home loan rate of 8.65%, the EMI comes to around Rs 74,516 per month, and the total interest is around Rs 5,912,951. While total payouts will be around Rs 13,412,951 including the principal amount.
(Image Source: SBI Home Loan EMI Calculator)
How Repo Rate Cut Impacts Home Loans?
When a homebuyer takes loans from banks or other financial institutions, they are charged with a certain rate of interest. This is called as cost of credit. The borrowers are required to repay the loan amount to banks including the amount of interest which is called EMIs.
EMIs stand for 'Equated Monthly Installments' which is a breakup of loan principal amount + interest rate on that loan. EMIs are obligatory to be paid every month, depending upon the due date assigned by banks.
In a similar pattern, banks and financial institutions borrow money from RBI by selling their government securities or other bonds. Banks do this to maintain adequate liquidity. The repo rate is just like the rate of interest, that banks pay to RBI for the money they borrowed.
When the repo rate is high, the cost of credit for banks is high. And hence, they pass on that impact to end consumers such as borrowers. In simple words, if a repo rate is high, banks increase lending rates. But when the repo rate is cut, the cost of credit is cheaper for banks and hence they reduce the lending rates that they offer to borrowers on home loans, personal loans, car loans, education loans and more.
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