Cheaper Advance loan for government employees! Right time to purchase your dream house
According to the Ministry of Housing and Urban Ministry, the new interest rate is effective from October 1, and this rate will remain effective for one year.
In you are working with a government department and have planned to buy your dream houses, the time is favourable for you as the government's apex bank has reduced the interest rate on Advance Loan to ourchase a house. For central government employees, the interest rate on House Building Advance (HBA) has been reduced from 8.5 percent to 7.9 percent.
According to the Ministry of Housing and Urban Ministry, the new interest rate is effective from October 1, and this rate will remain effective for one year. The government move is seen as an another step towards increasing the demand in the residential sector. The ministry's official statement has said that the interest rate on house building advance for one year for government employees has been reduced regardless of the loan amount. The interest will be charged at the rate of 7.9 percent if such employees opt for HBA.
Under this system, the rules is of extending advance in the form of loan to regular employees of the central government and also for temporary employees who have been in continuous service for 5 years. According to the statement, the ministry-departments have the right to give SBA to their employees under HBA rules.
Last month, Union Finance Minister Nirmala Sitharaman said that the interest rate on the house building advance will be reduced and it will be linked to the returns of 10-year government securities. She has stated that the government employees have a big contribution in boosting the demand for houses, therefore, this latest decision will encourage more and more government employees to buy a new house.
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Meanwhile, with the announcement of the RBI's monetary policey, reducing repo rate, if you have taken home loan of Rs 20 lakh for 20 years, and have been paying an EMI of Rs 16979, you will now pay reduced of Rs 16,667, therby, saving Rs 3744 annually.
On Rs 30 lakh home loan for 20 years, you have been paying an EMI of Rs 25,940, but now you will pay 25,468, thereby saving Rs 5664 on yearly basis, while on your Rs 50 lakh home loan for 20 years, you have been paying an EMI of Rs 43233, but now you will pay reduced EMI of Rs 42466 thereby saving Rs 9444 annually.