Citibank Home Loan Interest Rates
Interest Rate

Starting @ 6.75%

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Processing Fee

Upto 0.10%

Loan Tenure

5-20 years

Lowest EMI Per Lakh

₹ 760 for 20 years

Prepayment Charges

Nil charges for floating rates loans

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About Citibank

Citibank is one of the leading foreign banks in India with a presence in almost all the major cities in India. The bank has a legacy of more than 100 years, as it commenced operations in India with a branch office at Kolkata in 1902. Citibank brings world-class banking services to India by using the latest software solutions. Another exciting aspect of Citibank is that it believes in working from a green-certified building. It has three such building premises in India, thereby playing an essential role in environmental conservation.

Citibank Home Loans

Citibank is one of the pioneer banks in the credit card business in India. It also has other useful loan products in Home loans and mortgage loans. Citibank offers Home Loans for various purchases such as the purchase of readymade property or house under construction. It also has a Balance Transfer facility, whereby you can transfer your existing Home Loan to Citibank. The bank offers Home Loans to Non-resident Indians as well. Some of the features of Citibank Home Loan that can attract customers are its affordable interest rates, easy procedure, and flexible repayment methods. Transparency in its services is also a critical aspect of Citibank Home Loans.

Citibank Home Loans Interest Rate - The Methodology

Citibank adopts various methods of determining the interest rates on your Home Loan. The prime objective of these interest rates is to ensure that the customer gets the benefit of market rate fluctuations as soon as possible.

Treasury Bill Benchmark Rate (TBLR)

With effect from January 24, 2018, Citibank has introduced the TBLR. It is an external benchmark linked lending rate for Citibank Home Loans and mortgage loans. Existing and new customers can opt for the TBLR in place of the Marginal Cost of Funds-based Lending Rates.

Treasury Bill, a short-term debt instrument, is issued by the Government of India. Usually, the maturity period of this instrument does not exceed one year. These bills are issued at a discount and can be redeemed at face value on its maturity. Financial Benchmarks India Pvt Ltd (FBIL), an independent benchmark administrator, provides the daily T-bill rate benchmark on its website. Citibank adopts the 3-month Treasury Bill reference rate published by FBIL rounded off to the nearest 'Five basis points'.

TBLR is an external benchmark lending rate like the Repo Rate lending concept that has gained significance today. The advantage of the TBLR is that it ensures transparency and is an ideal indication of the market rates. Fluctuations in the financial markets affect this rate. Thus, the benefit of market rates can pass on immediately to the customer. Secondly, the rates are published by an independent benchmark administrator. Any person can access the website and confirm the rates anytime.

Citibank has adopted this methodology from January 24, 2018. Citibank fixes its Home Loan interest rate by adding an interest spread. Thus, the effective Home Loan interest rate is equal to the TBLR as applicable during the month + spread. The factors that determine the spread are loan amount, the type of facility, and the credit rating of the borrower.

Marginal Cost of Funds-based Lending Rate (MCLR)

With effect from April 01, 2016, all banks in India have switched over from the Base Rate to a transparent market-linked interest rate known as the MCLR. Citibank has also adapted to this method of calculation of interest on all its loan products. It includes housing loans and mortgage loans.

 MCLR comprises of the following four components:

  • Marginal Cost of Funds: Depends on the marginal cost of borrowings and return on net worth (92% - marginal cost, and 8% - return on net worth).
  • Tenor Premium: It is uniform for all types of loans and is not borrower-specific
  • Operating Cost: Cost of raising funds other than that recoverable by way of processing fees, and so on.
  • Cash Reserve Ratio Negative Carry: This factor comes to play when the return on the Cash Reserve Ratio balances is zero. The negative carry will arise when the returns are less than the cost of funds.

Citibank calculates its MCLR for varying tenors at frequent intervals. It loads an interest spread on this rate to arrive at the lending rate for Home Loans and other loans. The interest spread depends on factors like loan amount, tenure, and the credentials of the borrower. MCLR is also a transparent interest rate mechanism that accounts for market rate fluctuations.

Existing and new customers of Citibank have the option of adapting MCLR as their interest rate calculating mechanism. They also have the choice of switching over to the TBLR mechanism.

Base Rate

All loans sanctioned before `April 2016 follow the Base Rate mechanism. This mechanism was the first market-rate linked methodology followed by banks in India. The Base Rate mechanism came into force on July 01, 2010. Before that, banks had their individual Benchmark Prime Lending Rate (BPLR). The introduction of the Base Rate brought in the sense of uniformity in the interest rates offered by banks to its customers.

Base Rate is the minimum rupee reference rate for Citibank in India. The lending rates for individual loan products vary depending on specific factors. It includes credit spreads, liquidity tenor premium, and the costs associated with providing the loan product.

Customers who have adapted to the Base Rate mechanism have the choice of switching over to either the MCLR or TBLR-based interest calculation methods.

Citibank Interest Rate Structure

  • Base Rate of Citibank: With effect from September 7, 2019, the Base Rate of Citibank is 7.95%
  • MCLR: The MCLR of Citibank for different tenors w.e.f September 7, 2019 is as follows:
Tenor Overnight One-month Three-month Six-month One-year

MCLR

8.05%

8.35%

8.35%

8.45%

8.45%

Treasury Bill Benchmark Rate - TBLR

Citibank revises its TBLR depending on the rates listed out by FBIL on the 12th of every month rounded off to the nearest 'Five basis points'.

The TBLR for the last three months is as follows:

Date 3-months TBLR - FBIL publication Rounded off to nearest 0.05% TBLR of Citibank

June 12, 2019

5.94%

5.95%

5.95%

July 12, 2019

5.80%

5.80%

5.80%

August 12, 2019

5.43%

5.45%

5.45%

The TBLR for September 12, 2019, is available on the FBIL website. It is 5.29%. Hence, the Citibank TBLR should work out to 5.30%

Citibank Home Loan Interest Rate - Pricing Grid

TBLR-linked Floating Rate of Interest

 The grid is effective from September 4, 2019 (Effective TBLR - 5.45%)

Home Loan Product Rate of Interest Grid Effective rate of interest

Home Loans and Home Loan Takeover Products

Home Loans

TBLR 3M + 3.05% to TBLR 3M + 3.80%

8.50% to 9.25%

Home Loans with Home Credit

TBLR 3M + 3.15% to TBLR 3M + 3.90%

8.60% to 9.35%

Property Loans linked to Home Loans

All NPS loans with Home Credit

TBLR 3M + 4.05% to TBLR 3M + 4.80%

9.50% to 10.25%

Home Loan takeover with enhancement/top-up

Home Loan takeover with enhancement/top-up up to 100% of the loan amount

TBLR 3M + 3.30% to TBLR 3M + 4.05%

8.75% to 9.50%

 Specific points to note

  • For top-up loans over 100% of the Home Loan amount: The applicable rate is the weighted average of the grid rates on Home Loan and property power loan.
  • For top-up loans, less than 10% of the Home Loan: The Home Loan interest grid will be applicable.
  • For top-up loans more than 10% and up to 100% of the Home Loan: The rates mentioned above are applicable.

 Citibank TBLR-linked Home Loan Interest Rates - Points to Note

  • As on date, both TBLR and MCLR co-exist in Citibank. Customers are free to choose either of these two benchmark lending rates for their Home Loans.
  • Citibank publishes the TBLR every month based on the FBIL rates (3M Treasury Bill) as on the 12th day of the month. However, the interest rate will be reset every quarter. The TBLR reset dates are the first day of March, June, September, and December. Thus, the effective rate of interest for the entire quarter will depend on the applicable T-bill reference rates as on the first day of the quarter.
  • The bank will publish the TBLR as on the 12th day of every month, but the reset will be valid from the first day of the quarter beginning March, June, September, and December respectively.
  • Switching over from the existing CMPR/Base Rate/MCLR to the TBLR is free. Similarly, one can switch over from the TBLR to the MCLR concept at any time free of cost.
  • The spread will depend on the loan amount, facility, and Citibank internal loan assessment parameters.

MCLR-linked Floating Rate of Interest

This MCLR grid is effective from September 04, 2019. (Effective MCLR 3M is 8.35%)

Home Loan Product Rate of Interest Grid Effective rate of interest

Home Loans and Home Loan Takeover Products

Home Loans

MCLR 3M + 0.55% to MCLR 3M + 1.40%

8.90% to 9.75%

Home Loans with Home Credit

MCLR 3M + 0.65% to MCLR 3M + 1.55%

9.00% to 9.90%

Property Loans linked to Home Loans

All NPS loans with Home Credit

MCLR 3M + 1.55% to MCLR 3M + 2.55%

9.90% to 10.90%

Home Loan takeover with enhancement/top-up

Home Loan takeover with enhancement/top-up up to 100% of the loan amount

MCLR 3M + 1.05% to MCLR 3M + 2.05%

9.40% to 10.40%

Specific points to note

  • For the cash-out portion, more than 100% of the loan amount: The applicable rate of interest will be the corresponding weighted average of the Home Loan and property power loan interest rates.
  • For the cash-out portion, less than 10%: The Home Loan rates shall apply
  • For the cash-out part, between 10% and 100%: The rates mentioned above are applicable

Other points to note

  • Customers have the choice to opt for MCLR or TBLR-linked interest rates
  • They have a switchover option, as well
  • The final pricing of the Home Loan depends on the following factors:
  • The Home Loan amount and the product/facility
  • Internal Citibank loan assessment parameters

Citibank Home Loan Interest - Mode of Calculation

Citibank calculates Home Loan interest on the daily reducing balance method. Hence, the ideal repayment mode is EMI.

How to Calculate Citibank Home Loan EMI?

Citibank has an EMI Calculator on its official webpage. Entering information such as Home Loan amount, rate of interest, and repayment tenure will give you the Home Loan EMI.

Similarly, you can calculate your Citibank Home Loan EMI using MyMoneyMantra EMI Calculator. Using the calculator is easy. You need to provide information regarding the loan amount, the repayment tenure, and the applicable rate of interest to get the EMI.

Citibank Home Loan Interest - Frequently Asked Questions

Is the Treasury Bill Benchmark Lending rate equivalent to the repo rate announced by RBI from time to time?

The repo rate is the base rate for all kinds of market-related transactions. The repo rate is the interest rate at which banks borrow from the Reserve Bank of India. The Treasury Bill rate is the rate of interest provided by the Government of India on its short-term debt instruments. The Treasury Bill rate depends on the maturity of the instrument. Treasury bills are issued at a discount by the Government and can be redeemed at face value on maturity. Thus, both the repo rate and the TBLR are market-related rates.

Who provides the TBLR?

Financial Benchmarks India Pvt Ltd, an independent benchmark administrator, provides the T-bill benchmark rate on its official website.

How does Citibank calculate the TBLR-linked interest rate?

FBIL publishes the T-bill rates for varying maturities. Citibank uses the 3-month T-bill rate as the reference rate for its TBLR calculation that is posted daily. Citibank adopts the 3-month T-bill rate as on the 12th day of each month as its reference rate. It rounds off the rate to the nearest 'five basis points' for its TBLR reference calculation. 

Citibank calculates the TBLR as applicable on the 12th day of the month and adds its interest spread. The spread depends on factors like loan amount, facility type, and credit rating of the borrower.

What is the TBLR reviewing frequency?

Citibank reviews and publishes its TBLR every month. If the 12th day of the month happens to be a holiday, Citibank uses the TBLR for the next working day as the reference rate.

What is the TBLR reset frequency?

Citibank resets the TBLR every quarter. It publishes the rate as applicable on the 12th day of the month.

The TBLR reset dates are the first days of March, June, September, and December. The reset accounts for the increase/decrease in the T-bill rates for the months that fall in the quarter.

Who are eligible to opt for the TBLR-linked interest rates?

All new and existing borrowers are eligible to opt for the TBLR-linked interest rates. This rate is valid from January 24, 2018.

Do I have the option to choose the MCLR-linked rates?

Borrowers have the option to choose MCLR-linked interest rates.

Can I switch over from the MCLR to the TBLR-linked rates and vice versa?

Existing customers can choose to switch over from the MCLR to TBLR-linked interest rates and vice versa. Citibank does not charge any fee for affecting this transfer. This switchover requires the borrower to execute a supplementary agreement. Customers in the Base Rate regime can also switch over from the Base Rate to MCLR/TBLR-linked interest rates. The vice versa is not permissible in this scenario.

Does the change in the MCLR/TBLR affect my Home Loan EMI?

A change in the MCLR/TBLR affects the effective rate of interest on your Home Loan. Therefore, it entails a difference in the EMI, as well. However, you have the option to maintain the EMI as constant and vary the loan tenure within permissible limits. Under such circumstances, Citibank increases or decreases the loan repayment tenure accordingly. Alternatively, you can keep the mandate constant and vary the EMI.

Which is beneficial, TBLR or MCLR-linked Home Loan interest rate?

The TBLR is a real market rate and not owned by any bank. The Reserve Bank monetary policy and rate changes affect the T-bill rates. An independent benchmark administrator decides the rates, thereby making it a transparent mechanism. Anybody can confirm the FBIL T-bill rate at any time on the FBIL official website. Compared to the MCLR, the TBLR is beneficial, as on date. The MCLR also depends on market conditions.

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