Query about SBI Max gain – reduce interest rate scheme

POSTED BY parag ON December 24, 2013 4:04 pm ONE COMMENT

Hi,

I have taken sbi maxgain home loan in 2011. Arrangement letter provided by bank states that I will be charged 1% above base rate. Usually It is called as spread. Current base rate is 10% and spread is 1%. So effectively I am paying 11% rate of interest rate. (10% base rate + 1% spread). Recently I have received letter from bank which states that I can switch to lower interest by paying 0.56% of outstanding amount and I could enjoy the rate of 10.30% (base rate 10% and 0.30% spread).

So my questions this spread 0.30 will remain for the entire tenure of the loan or only for some period. I am aware that base rate could change in future. But what I want to know is this spread of 0.30% will remain constant throughout the tenure of the loan. Can anybody clarify this?

One reply on this article “Query about SBI Max gain – reduce interest rate scheme”

  1. ashalanshu says:

    Dear Parag, the spread ‘ll not change unless you apply for in future. Just take your current example, the spread is 1% and only after your consent (and of course after paying conversion fee), the SBI is changing it to 0.3%.

    So relax, post conversion, your spread ‘ll remain constant.

    Thanks

    Ashal

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