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South Indian Bank Home Loan Interest Rate

Buying a house is a huge financial investment, it requires outlay of one’s life time earnings. Financial institutions enable buying the house by funding part of the project. It is no longer a distant dream for most individuals, they are able to fulfill their dream to own a home much earlier in life. Home loans have changed the landscape of property ownership. Home loans can be availed from banks or NBFCs (non-banking financial corporations). The quantum of loan and interest rate varies among different lenders.

Types of Home Loans

The various types of home loans are –

  • Home Purchase Loan : Loan that one takes for purchasing a home
  • Home Improvement Loan : Loan covers expenditure related to repairs of your home or even renovation
  • Home Construction Loan : Loan comes in handy when you are building a new house
  • Land Purchase Loan : Used to buy a plot of land for constructing his/her own house
  • Home Extension Loan : Used to add another room, garage, bathroom or kitchen, add another floor to your home
  • Joint Home Loan : Loans taken by two people or even more
  • Home Loan Balance Transfer : Use this mechanism to switch existing outstanding loan amount to a different lender with better terms and conditions and lower interest
  • Top Up Home Loan : This kind of loan helps one to borrow some more money above the outstanding loan amount

Types of Interest Rates on Home Loans

  • Fixed interest rate – This interest rate will remain fixed during the entire tenure of the loan. The fixed interest rate would be base rate + margin, it would differ among lenders. It is recommended that if the market interest rate is on an uptrend, the applicant should choose fixed interest rate. This will help locking the interest rate at a certain level over the tenure of the loan or atleast till the period of revision as per bank policy.
  • Floating interest rate – The interest rates in the case of floating interest rate is linked to the prime lending of the bank. This prime lending rate is affected by repo rate. Repo rate is the rate at which the bank borrows money from the central bank. This fluctuates based on the macro economic scenario of the economy. The advantage of the floating interest rate is that it tends to be a bit lower than the fixed interest rates.
  • Hybrid interest rate – Hybrid interest rate are a combination of fixed interest rate and floating interest rate. A part of the interest rate is fixed and the rest of the component is floating. The floating component fluctuates based on the market interest rate.

Interest rate applicable for Home Loans from South Indian Bank

The interest rate on home loan from South Indian Bank is fixed at 1-year MCLR or 6 months MCLR + 0.10%. Women borrowers can get concession of 0.50%.

The interest rates above-mentioned are subject to change at the sole discretion of the bank. For the most recent rates, you can approach the bank.

Factors which influence interest rates on Home Loans from South Indian Bank

These are some of the factors which influence the interest rate of home loan from South Indian Bank –

  • Credit score

    Credit score reflects the credibility of the applicant. The higher the credit score, the better is the applicants position to negotiate a favorable interest rate.

  • Quantum of Loan

    A higher quantum of loan would enable negotiation of lower interest rate with the bank.

  • Stability of income

    Higher income and stability of income is critical for negotiating favorable interest rate.

  • Type of applicant

    Salaried, self-employed professional, self – employed businessmen can apply for home loan from South Indian Bank. Salaried applicants who have a long standing employment history and those employed with reputed employers are likely to gain favorable terms.

  • Property price and loan value

    Property value would determine the loan value from the bank. The property value that is considered includes home price and closing costs reduced by the down payment.

  • Location of property

    The interest rates applicable for different home locations is different. There will be difference between vendors on the interest rates for home loans.

Purpose of Home Loans from South Indian Bank

The home loan offered by South Indian Bank can be used for the following purposes -

  • Purchase ready to occupy/Repurchase of flat/house aged up to 20 years
  • Purchase of land and Construction of House. (In cases where plot is purchased and construction is undertaken at a later stage, declaration to be obtained from the borrower that he intends to construct a house on the said plot with the help of bank finance)
  • Purchase of Flat or villas under construction in Housing Projects approved by bank.
  • Additions to the house / flat (Since Estimate/plan/permit is available & equivalent to new construction, no restriction on loan amount).
  • Alteration / Repair/ Reconstruction to the house / flat.
  • Reimbursement of Expenses incurred within two years for Flats/ Villa under Construction, and Purchase of Ready to occupy Flat/ Villas.
  • Takeover of Housing Loans.

South Indian Bank Home Loan Eligibility

The target customers for home loan products offered by South Indian Bank are –

  • Salaried (Employees of Government, PSU, MNC, Listed companies and reputed Public and Private limited companies only)
  • Self-employed Manufacturers, Traders, Wholesalers, Retailers, Service Providers
  • Self-employed Doctors, CA, CS, ICWA, Architect, Engineer
  • Agriculturist
  • Senior citizen / Pensioner

Features and benefits of Home Loans from South Indian Bank

The key features and benefits of home loan availed from South Indian Bank are –

  • Minimum / Maximum age – 21 years – 75 years
  • Loan amount – Minimum – Rs. 2 Lakh; Maximum – Rs. 1500 lakhs
  • Tenure – 5 – 30 years
  • Loan value – upto 90% of property value
  • Collateral – property to be bought or constructed
  • Minimum credit score requirement – 600
  • Processing fee – 0.50% of loan amount (Minimum Rs 5000 +Service Tax; Maximum Rs 10000.00)
  • Penal Interest – 2% p.a. for the defaulted amount for the defaulted period

Frequently asked questions on Home Loans with South Indian Bank

1. Who can apply for home loan?

Salaried individuals, self-employed professionals and self-employed businessmen can apply for home loan from South Indian Bank.

2. What is the interest rate at which one can avail home loan from South Indian Bank?

The interest rate at which the home loan is extended is as mentioned below -

  • MCLR (6 Months) +0.10 % (concession of 0.05% to women borrowers)
  • MCLR (1 Year)

3. What repayment options are available with South Indian Bank?

The EMI can be repaid by any of the following means –

  • Cheques
  • Standing instructions at local branch
  • Internet Banking
  • Automated Payment through ECS
  • Mobile Banking

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