LIC Housing Finance Offers Home Loans @ 6.9% – Features and Hidden Factors
Few days back, mortgage financier, LIC
Housing Finance (LIC HFL) has announced that it would provide housing loans at 6.9% which is the lowest in India. LIC Housing Finance says that due to reduction in repo rate by RBI and to create demand, they are offering lowest home loans in India now. With covid-19, real estate sales have fallen drastically now. In this article, we would provide details about LIC Housing Finance home loan offer of 6.9% and also indicate any hidden factors in this.
Also Read: 6 [Proven] Ways to Reduce your Home Loan EMI
Features of LIC Housing Finance Home Loans @ 6.9%
LIC housing (LIC HFL) is one of the largest mortgage financier in India. Here are the features of the lowest interest home loans offered by them now in 2020.
1) Home loans would be offered at 6.9% interest rates to all new home loan borrowers only.
2) Cibil score of such borrowers should be 700 and above.
3) The interest rate offered is for home loans upto Rs 50 Lakhs. If it crosses 50 lakhs, the interest rate would be 7%.
4) Lower interest rates are being offered by LIC Housing after RBI has reduced repo rates in the last few quarters. Company cost of funding is 5.6%, hence company says they are able to offer lower interest rates now.
5) These loans are provided for purchase of properties, construction, extension or renovation of homes and towards the purchase of plots.
6) These home loans are applicable to everyone i.e. salaried and businessmen. However the maximum home loan tenure for salaried is 30 years and for businessmen is 20 years.
LIC Housing Finance home loans interest rates in 2020
Here are the interest rates offered by them
Is there any minimum and maximum home loan amount?
Here are the details.
Minimum home loan is Rs 1 lakh.
The maximum home loan would be based on the property value as indicated below.
- 90% of property value – Up to Rs 30 Lakhs loan
- 80% of property value – Between Rs 30 Lakhs to Rs 75 lakhs loan
- 75% of property value – Rs 75 Lakhs and above loan
In case of purchase of land / plots, maximum loan would be 75% of property value.
Are there any hidden factors in this LIC Housing Finance home loan scheme?
Here are a few things one should check before opting such home loan schemes.
1) This home loan offer for 6.9% interest rate is only for individuals who have cibil score of 700 and above. In April, they have come up with reduced interest rates of 7.5% for individuals who has cibil score of 800 and above. Now this is relaxed by 100 points. One should check their cibil score before applying for such home loans.
2) If you are opting for Rs 50 Lakhs and more, the interest rate is slightly higher i.e. 7%.
3) If you are opting for a home loan between Rs 30 Lakhs to Rs 75 Lakhs, the maximum home loan would be 80% of property value. This is common for home loans, but one should be aware of this fact before even applying.
4) If you are in 30’s / 35’s and doing business, you can get home loan tenure up to 20 years only unlike for salaried where they can get a loan for tenure up to 30 years.
5) There are some messages floated saying that there is 6 months EMI waiver or 48 month moratorium period for purchase of units under construction in this scheme which is not correct. The 6 months EMI waiver + 48 months moratorium is for LIC Housing Gruha Varishtha which is a new home loan scheme launched by LIC HFL for PSU retired employees only. Both are different schemes.
Also Read: How to get maximum income tax benefits on home loans?
Should you opt for LIC Housing Loans lower interest scheme?
Who can say no to such low interest home loans? If you have a plan to buy property / invest in plots even during covid-19 crisis, you can definitely opt for such home loan schemes. One should check their cibil score (check free Cibil score on their website link) and a few other factors indicated above before they proceed to check with LICHFL.
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