Is there any penalty for prepayment of SBI home loan?

Loan Tenor:
Pre-closure Charges:- Loans on Fixed and Floating rate of interest: No pre-payment/ Pre-closure penalty will be levied on Home Loans irrespective of the period for which the account has run or source of funds.
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What is prepayment penalty for SBI home loan?

Nil to 2% of the prepaid loan amount. Federal Bank. Nil to 3% of the outstanding balance. Nil to 3% of the outstanding balance. State Bank of India.
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Is prepayment allowed in SBI home loan?

We have no upper limit. The loan amount is determined by repaying capacity and the value of property to be financed. We offer loans with one of the longest tenors (up to 33 years) with the flexibility provided to reduce the tenor by prepaying the loan without any penalty.
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Does SBI charges for prepayment?

SBI charges 3% of the prepaid loan principal amount as the foreclosure charges on personal loan.
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Is there any penalty for prepayment of home loan?

While on adjustable rate home loans there are no prepayment charges, on fixed rate home loans, lenders usually charge a penalty of 2 percent of the amount being prepaid through refinance, i.e. when you borrow to prepay your home loan.
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Compilation of Pre Payment Penalties in Various SBI Loans and how you can avoid them



How can I close my SBI home loan early?

Closure of Loan A/C
  1. Click Requests > Closure of Loan A/C. A Closure of Loan A/C page appears.
  2. Select the loan account you wish to close.
  3. Select the transaction account which will be debited to close the loan. Figure 1 shows sample settings.
  4. Click [Submit].
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Does prepayment reduce principal?

When you pay your EMI, the interest amount is deducted and the rest is paid towards the principal. Now, when you make a prepayment, the total principal outstanding is reduced.
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Does SBI charge foreclosure fees?

Foreclosure charges @ 3% + GST on Theo balance to be levied only if closed within 2 years from the disbursement of loan.
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What is principal penalty rate?

Yes, most banks allow you to repay the loan ahead of schedule by making lump sum payments. However, many banks charge early repayment penalties up to 2-3% of the principal amount outstanding.
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Can we pay more than EMI in home loan SBI?

Yes, you can pay more than the regular EMI. The excess amount will not only decrease your principal outstanding, but also reduce your interest burden.
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How many times prepayment can be done?

Borrowers may be allowed to foreclose or prepay their loan 6 months after the date it has been disbursed, without any prepayment penalty. A charge of 2.5% + GST will be levied on any prepayment amount that is over 25% of the principal due. Part prepayment can only be done once in a year.
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Will I lose the subsidy under PMAY if I prepay the loan?

Can you prepay the home loan if you received PMAY subsidy? The PMAY subsidy that you have availed of, is applicable only if the loan is active for the entire period and hence, if you prepay some amount, the subsidy amount will be reversed and you will miss out on some part of the benefit.
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Can I reduce my SBI home loan EMI?

Go for tenure extension

For instance, if you have 10 years left on your home loan outstanding of Rs 40 lakh at 7.5%, then extending the tenure to 20 years can help you reduce your EMI by Rs 15,257.
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Can we pay loan amount in advance in SBI?

SBI enables you to make a pre-payment or a pre-closure for your personal loan. You have the flexibility to pre-pay in full or in parts. Moreover, you can do it during any phase of your personal loan.
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How is prepayment penalty calculated?

First, divide the annual interest rate in half to get 2.5 percent. Then, multiply this value by the outstanding balance to get interest paid in six months. This would be $150,000*0.025, or $3,750. Then, multiply this result by 80 percent to find the prepayment penalty.
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How much are prepayment penalties?

How much are prepayment penalties? Although prepayment penalties are rare today, when applicable, the fee can be steep. The penalty can be 2 percent of your loan balance within the loan's first two years and 1 percent of your loan balance in year three.
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What are prepayment penalties?

A prepayment penalty is a fee that some lenders charge if you pay off all or part of your mortgage early. If you have a prepayment penalty, you would have agreed to this when you closed on your home. Not all mortgages have a prepayment penalty.
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How is foreclosure amount calculated?

You can calculate the prepayment charges by determining the different between the original interest rate and the current interest rate. For example, if the original interest was 7.5% and the current rate is 5.5% the difference is 2%. Multiply the principal amount by the difference in percentage – 200,000 x 0.02 = 4000.
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Can I pay my loan early?

Yes, it can be a good idea to repay your personal loan early as you will be charged a less interest on the loan amount. Also, once you clear your loan early, not only will you be able to save considerable, but your overall credit score will also improve allowing you to avail another loan if necessary.
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Can I close SBI loan account online?

No, you cannot close the personal loans online for SBI. Individuals are required to visit the SBI Branch to close the personal loan. Below are the steps to close the SBI personal loan: Visit the nearest SBI branch.
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Which is better increase EMI or prepayment?

Not everyone has the risk appetite, so prepayment appears a much safer option. It is always good to increase the EMI amount for it ensures forced discipline; one does not have to worry about returns on investment, says Agarwal.
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How can I clear my home loan faster?

Here's how you can repay your home loan faster:
  1. Make Maximum Down Payment: ...
  2. Choose the Lender that Offers Lower Interest Rate: ...
  3. Consider Other Fees and Charges: ...
  4. Increase Your EMI: ...
  5. Make Part-Payments: ...
  6. Choose Your Loan Tenure Wisely: ...
  7. Tax Benefit: ...
  8. Take Advantage of the Falling Interest Rate:
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Can we change SBI home loan tenure?

Process of Changing the Home Loan Tenure. The tenure can be changed voluntarily anytime during the course of the loan. You can visit the branch of the lender and give a request for the same. The concerned official will go through your loan statement and latest income statements before allowing you to change the tenure.
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Can bank charge foreclosure charges?

The Reserve Bank of India on Friday clarified that banks and non-banking finance companies cannot impose foreclosure charges/pre-payment penalties on any floating rate term loan sanctioned, for purposes other than business, to individual borrowers with or without co-obligant(s).
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Can I repay home loan in cash?

08 min read. You can repay your loan amount to any HFC (Housing finance company) or NBFC (Non-banking finance company) in cash provided each loan instalment is less than Rs 2 lakh. The government introduced a new section 269ST.
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