One term you may encounter if you plan to apply for a bank house loan is BPLR. But, what is BPLR in home loan? BPLR or Benchmark Prime Lending Rate is the interest rate at which banks lent money to their most creditworthy customers before the newer interest rate frameworks. It was used for home loans and other loans until 2010, when the RBI replaced it with the Base Rate system to improve transparency in lending rates.
BPLR was the reference rate banks used to set lending rates for borrowers. However, banks had the discretion to charge different interest rates based on the borrower’s risk profile.
Each bank determined its own BPLR based on factors like cost of funds, operational expenses, and profit margins. This led to variations in BPLR across different banks.
Transition from BPLR to New Systems
Here are a few points you must know.
The RBI introduced the Base Rate system to ensure transparency in loan pricing. Banks could not lend below this rate.
Marginal Cost of Funds-based Lending Rate (MCLR) (2016-2019): This system linked loan rates more closely to market conditions, ensuring fair pricing.
Currently, home loan interest rates are linked to external benchmarks like the RBI’s repo rate, making them more transparent and dynamic.
Borrowers with home loans under the BPLR system can switch to MCLR or EBLR for better interest rates. Banks usually offer an option to migrate, but a processing fee may apply.
I hope you understood about the BPLR in the home loan.
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Hi, if you are trying to learn which bank gives home loan for auction property in India, then I can be of help to you. When I bought an auction property, I took out a loan from HDFC Bank. Apart from that, there are several other banks from which you can opt for a home loan. Those are,
Kotak Mahindra Bank
ICICI Home Finance
IIFL Home Loans
Bank of Baroda
Bank of India
Central Bank of India
Union Bank of India
And that’s about it. I hope you find this information useful.
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Which Bank Gives Home Loan for Auction Property?
Balakrishna
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2024-12-16T11:17:23+00:00 2024-12-17T09:36:37+00:00Comment
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