SBI to end teaser home loan rates
20 Apr 2011
State Bank of India (SBI) today announced the withdrawal of its teaser loans effective 1 May 2011. The revised rates, however, will not affect the existing home loan customers, the bank said.
The withdrawal of teaser rates is in line with its hike in base lending rate announced yesterday, which made all loans costlier.
Under the new floating rate scheme, loans up to Rs30 lakh would attract an interest rate of 9.50 per cent, those between Rs31-75 lakh, 9.75 per cent and credit above Rs75 lakh would attract 10.25 per cent rate.
SBI had launched teaser home loan schemes in August 2009, following a slowdown in housing business in India in the wake of the global financial meltdown.
Residential real estate market has now bounced back with an upward pressure across cities in the country, the bank noted.
"Taking cognizance of the above and also taking note of regulatory concerns, the bank has decided to withdraw SBI Easy Home Loan and SBI Advantage Home Loan w.e.f May 1, 2011," SBI said in a statement.
The Reserve Bank of India had advised SBI against the teaser loans and had refused to waive additional provisioning requirements for such loans.