Home Loan Rates 2018 569 views
Axis Bank has become the first lender that has launched a new home loan product wherein the borrower will not have to pay 12 EMIs on a home loan. The name of this new product is Shubh Aarambh Home Loans. In this scheme, if a borrower takes a 20-year home loan, he/she will get 12 of the EMIs waived off which will save up to ₹3.09 lakhs on a ₹30 lakh home loan. The waivers are only applicable for Axis Bank home loan of up to ₹30 lakhs and will be given in the form of a reduction in loan tenures. The waive off of EMIs will be available for four EMIs each at the end of the 4th, 8th and 12th year of a twenty-year loan.
The third largest private sector lender in India is extending the benefit to the affordable housing segment with the expectation of better credit behavior and longevity of a loan as pre-payments will be fewer. Also, if the home loan borrower is eligible to avail subsidies under the Pradhanmantri Awas Yojana (PMAY), the maximum savings would be over ₹5.6 lakh.
Axis Bank already offers affordable housing scheme called Asha home loan which is for the lower income group applicants of loans up to ₹25 lakhs. Asha home loan accounts for around 5 per cent of its mortgage book and as of June, the home loans constituted a whopping 44 per cent of the ₹1.68 trillion retail portfolios of the bank.
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What is the interest rate on Axis Bank New Home Loan?
Axis Bank home loan interest rate on Shubh Aarambh home loan is similar to other schemes offered by the bank that is presently 8.35% per annum. There is no concession on the interest rate as this product has a different objective from its other home loan products.
Difference between Normal Home Loan and Shubh Aarambh Home Loan
Unlike a normal home loan, a borrower can save much more if he/she applies for Shubh Aarambh Home Loan. You can check the difference between the total interest payout on a normal home loan and Shubh Aarambh home loan of ₹30 lakhs availed for the tenure of 20 years in the table below:
|Home Loans||Total Amount Payable (Interest+Principal)|
|Normal Home Loan||₹61,80,141|
|Shubh Aarambh Home Loan||₹58,71,129|
How can Shubh Aarambh Home Loan be used?
The loan can be used to purchase an under-construction/ready/resale house, self-construction, and a plot plus construction. Even though the new home loan product aims at first-time borrowers, the existing home buyers can balance transfer their home loan to take the benefit without additional cost. Thus, if you have an existing home loan, you can transfer your home loan at Axis Bank and enjoy this benefit of paying 12 EMIs less.
Why is it different from other home loans?
It is the first time in history that a lender has introduced waiver on home loan EMIs. The purpose of this product is to encourage new home loan buyers and help them in buying their dream home. The EMIs will not be waived off collectively but on a regular interval of 4 years, 8 years and 12 years on the total loan tenure of 20 years. You can use Axis Bank Home Loan EMI Calculator to check how much you can save on your repayment.
Who is eligible?
The eligibility criteria to apply for Shubh Aarambh Home Loans is similar to other home loans offered by the lender. Both salaried and self-employed individuals can apply for this loan. But, only the borrowers who pay the EMIs regularly are eligible for the waiver of 12 EMIs and those who will miss even a single EMI will be disqualified from it. In addition to this, the applicants who are eligible to avail subsidies under the Pradhan Mantri Awas Yojana (PMAY), can save over ₹5.6 lakh.