Benefits of Repo Rate cut by RBI to Home Buyers

To maintain economy and Real Estate Sector, the Reserve Bank of India (RBI) governor, Shaktikanta Das announced rate cuts in Repo Rate to stave off a corona-virus-related recession on 27/03/2020.

This might soothe the nerves of equity investors and reduce EMIs for Home Buyers.

The RBI, cut the repo rate and reserve repo rate by 0.75 % and 0.90 %, respectively . The repo rate now stands at 4.4 per cent and reserve repo rate at 4 per cent.

Here is a look at how today's rate cut will give benefit to Home Buyers

Benefit of the rate cut on Home Buyers
The unexpected rate cut is likely to reduce equated monthly installments (EMIs) of borrowers, and also make it cheaper to take new loans.

Here's an example of how your home loan is likely to be impacted under the new external benchmark regime.

If any Male Salaried buyer takes 30,00,000 Rs Home Loan for tenure of 20 years, then as per current rates he has to pay EMI of 24,999 but now onward he has to pay EMI 23,620 , it means he is going to save 1,379 Rs in EMI due to this repo rate cuts (interest rate considered is 7.20% )

This will definitely boost the real estate sector.

For more details regarding home loan and property you can contact us. Also share your views in comment box.

(source: ET )

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