Home loan between LICHFL and SBI

POSTED BY Reetesh Sahoo ON October 26, 2012 3:29 am COMMENTS (3)

Dear team,

I booked a flat last year. Total property cost around 36 lakhs and i already paid around 8 lakhs. I am planning to take a home loan of 28 lakhs. Could you please which is the best option between LIC and SBI? LIC is now offering at 10.25 (3yr locking) and SBI is offering at 10.00 interest rate.

I have already applied for LIC 2 months back at 10.40 intrest rate (SBI was offering at 10.5 during that time) and paid 5k as processing fee. However 1st disbursement is yet to started as builder is behind it schedule. Now in between the repo rate is changed and SBI is offering at 10% interset rate. So need your suggetion should i apply for SBI or stick to LIC?

Also very recently i goggled a lot and got some mix feedback about LIC so i m really not sure what to do. Please suggest so that i choose the better option for long term.



3 replies on this article “Home loan between LICHFL and SBI”

  1. Reetesh, please opt SBI’s Max Gain. Being Base Rate. it’s far more transparent than PLR linked LICHFC Rates.



  2. Reetesh Sahoo says:

    Thanks for sharing.

    I know i will loose the processing fee from LIC. But my prelimary question is what will be the best option between LIC and SBI. Can you please put down some pros and cons of both and any additional advantage.
    I read in couple of sites and found out that in SBI there is max plan where you can put any surplus money and they will reduce/increase the interest rate on next day after declaration of repo rate where as LIC re-look it on every 3 months. Also in LIC there will be some prepayment charges.

    Kindly suggest. Thanks in advance.

  3. Credexpert says:

    Dear Reetesh,

    Whilst interest rates, fixed, variable etc. are key components of any decision to borrow, there are other factors also. You have paid a processing fee to LIC which is unlikely to be refunded. Additionally, the LIC loan seems to insulate you against any upward revision for 3 years ( unfortunately, it also works the other way!). SBI will also have a processing fee.

    There will always be different experiences, good and bad that borrowers will have with lenders – you should consider your experiences whilst deciding.

    A housing loan is a long term borrowing – you will have opportunities to switch if better offers come along in the future.


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