Property loans that were down to 10 per cent, now getting thousand proposals a month

VAIBHAV PARWATAurangabad, July 29:

After a brief lull, the home loan sector in the banks in the city is seeing a rise in monthly turnover. Nearly 2,000 aspirants are approaching banks to apply for home loans and more than a thousand applications are being filed every month in nationalised and private banks. More than half of these applications are being filed in the State Bank of India. The property loan market that was down to only 10 per cent has regained momentum, said senior bank officials.

Despite banks staying in operation during the lockdown, not even a single home loan proposal was filed in the nationalised banks in the four months of lockdown last year. The situation was similar during the second lockdown as banks received only 10 per cent of the proposals. As the restrictions were lifted, the transactions in the property market were back to pre-covid stage. According to SBI bank manager Pravinkumar Sahu, the number of people approaching banks for home loans has increased as compared to lockdown. As the market remained sluggish during the past one year, the number of home loan proposals was down to only 10 per cent. But now nearly 600 to 650 applications are filed in SBI branches across the city per month. Customers mostly seek loans between Rs 10 to 50 lakh. However, it is only a 40 per cent increase, he said. Not only nationalised banks, but private sector banks are also receiving applications due to reduction in home loan interest rates. Around 400 to 450 proposals are being filed in private banks across the city.

70 per cent contribution

Due to improving market conditions and ease in restrictions, the economy is returning back on track as people are spending money. Banks mostly receive loan proposals for property and vehicles. Home loan proposals contribute 70 per cent of proposals filed in a bank. Loans are sanctioned ranging from Rs 15 lakh to 1 crore. Proposals are mostly filed for loans between Rs 20 to 40 lakh. From 1,000 people approaching banks, 700 to 800 people opt for taking a loan, said Suhas More, loan manager at a private sector bank.

Banks cut interest rates

Many banks have slashed interest rates on home loans to attract the interested home buyers. Concessions are being offered by some banks as per the loan slab. This also shows the tendency of many to take home loans.

Loans Percentage

Rs 10 to 25 lakh 30 per cent

Rs 25 to 50 lakh 50 per cent

Rs 50 to 1 crore 15 per cent

Rs 1 crore 5 per cent

Interest rates of banks:

State Bank of India: 6.70 to 7.80 per cent

UCO Bank: 6.90 per cent to 7.25 per cent

Punjab National Bank: 6.75 per cent to 7.55 per cent

ICICI bank: 6.75 per cent to 7.75 per cent

HDFC bank: 6.75 per cent to 8 per cent