RBL Bank Home Loan Interest Rate
Interest Rate

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Loan Tenure

- years

Lowest EMI Per Lakh

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Prepayment Charges

Nil charges for floating rates loans

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About RBL Bank

RBL Bank was initially known as Ratnakar Bank Ltd. It was found as a regional bank in Maharashtra with two branches in Kolhapur and Sangli. Ratnakar Bank was established to service the small and medium enterprises and traders in Maharashtra. In 1959, it attained the title of a scheduled bank.

In 2014, Ratnakar Bank Ltd changed its name to RBL Bank. It is one of the fastest-growing private sector banks in India with a network of 332 branches and 376 ATMs spread over 23 Indian states and union territories. The bank performs under six business verticals.

About RBL Bank Home Loan

RBL Bank caters to all sections of society, especially the small and medium enterprises. It has a well-defined Home Loan product to cater to the housing requirements of more than 6.9 million customers all over the country. Some of the features of its Home Loans are the attractive rates of interest it offers to its customers. RBL Bank offers housing loans on both fixed and floating rates of interest. The transparency in services and relaxed eligibility norms make the Home Loan product a favourite with its customers in India.

RBL Home Loan - Features and Benefits

  • RBL Bank provides easy Home Loans up to 10 Crores
  • Minimal documentation and quicker approvals make RBL Bank Home Loans popular among the millennials.
  • The bank offers a flexible loan repayment tenure of up to 25 years
  • The RBL Bank Easy Home Loan facility enables you to save interest by maintaining sufficient balance in a linked account.
  • RBL Bank offers Home Loans to salaried employees and self-employed individuals and professionals.
  • RBL bank offers attractive interest rates linked to its MCLR
  • Both floating and fixed rate of interest Home Loans are available

RBL Bank Home Loan Interest Rate

RBL Bank follows the Marginal Cost of Funds based Lending Rate structure (also known as MCLR) for its Home Loans and other loans. The MCLR concept is in force since April 01, 2016. RBL Bank announces its MCLR every month as all other banks do. The latest such announcement is valid from September 22, 2019.

The MCLR is a market-related interest rate structure that depends on specific factors. They are:

  • Marginal cost of funds
  • The tenor premium
  • Operating cost
  • Negative CRR Carry

The MCLR with effect from September 22, 2019, is as follows:

Tenor Overnight 1M-MCLR 3M-MCLR 6M-MCLR 1Y-MCLY

MCLR

9.15%

9.20%

9.45%

9.65%

9.95%

The Home Loan interest rate structure of RBL Bank is as enumerated below. The pricing grid is with effect from July 22, 2019. The same grid holds good until the next resetting cycle.

Home Loan Product Rate of Interest Effective rate of interest

Home Loan - Floating Rates of Interest

Up to 25 Lakhs

1Y-MCLR + 0.35%

10.30%

More than 25 Lakhs up to 75 Lakhs

1Y-MCLR + 1.70%

11.65%

Above 75 Lakhs

1Y-MCLR + 1.70%

11.65%

Home Loan - Fixed Rate of Interest

All amounts

13.50%

13.50%

Easy Home Loan

Up to 25 Lakhs

1Y-MCLR + 0.85%

10.80%

More than 25 Lakhs and <= 75 Lakhs

1Y-MCLR + 2.20%

12.15%

Above 75 Lakhs

1Y-MCLR + 2.20%

12.15%

RBL Bank Home Loan Interest Rate - Points to Note

  • RBL Bank offers both fixed-rate and floating rate of interest on Home Loans
  • The fixed rate of interest is considerably higher than the floating rate
  • The Easy Home Loan rates of interest are comparatively higher than the regular Home Loan. However, the product is a beneficial in many ways.
  • The MCLR rate keeps changing every month, but the effective housing loan rates do not. It depends on the reset frequency adopted by RBL. Usually, banks have a quarterly reset schedule.

RBL Bank Home Loan - Base Rate Structure

Before the MCLR concept came into being, RBL Bank followed the Base Rate Structure. It announces the applicable Base Rate at regular intervals. The Base Rate of RBL bank with effect from March 01, 2019 is 10.15%.

RBL Bank Home Loan - Prime Lending Rate

The Base Rate structure was effective from July 01, 2010. Before this date, RBL Bank used to link the Home Loan interest rate structure with the bank's Prime Lending Rate. The PLR of RBL Bank with effect from March 01, 2019, is 16.25%.

RBL Bank permits its borrowers to switch over from the PLR or the Base Rate to its MCLR on the payment of a conversion fee. Similarly, it allows a change over from its fixed-rate structure to the floating rate by paying the conversion fee. The bank does not allow the switch over from the MCLR to the Base Rate/PLR.

RBL Bank Home Loan - Service Charges

Type of charges Amount

Processing fees on Home Loans

1.50% of the loan amount

Application fees for Home Loans

  • For Mumbai: 6,500
  • For other locations: 5,000

Penal interest for late payment of EMI

2% additional interest on the overdue amount per month

Duplicate interest and principal certificate

250 per instance

Duplicate NOC and No Dues Certificate

250 per case

Cheque swapping charges

250 per instance

Cheque bouncing charges

250 per instance

CIBIL report charges

50 per instance

Conversion charges from a fixed rate to floating rate of interest

0.50% of the principal outstanding amount

Conversion charges from floating rate to fixed rate of interest

0.50% of the principal outstanding amount

Part-payment and foreclosure charges on floating rate of interest loans

NIL

Part prepayment on a fixed rate of interest loans

  • Up to 15% of outstanding principal balance in a year: NIL
  • More than 15%: 3% of the amount paid

Foreclosure charges on a fixed rate of interest Home Loans

3% on the principal outstanding amount

Rate switching charges

0.50% of the principal outstanding amount or 50,000 whichever is lower

RBL Bank Home Loans - Calculation of Interest

RBL Bank adopts the daily reducing balance method to calculate Home Loan interest. It ensures that the customers get the benefit of the repaying the EMI on time. This method of calculation suggests that EMI is the ideal mode of repayment.

Calculation of EMI

RBL Bank does not have an EMI Calculator on its website. However, customers can use the calculator available on MyMoneyMantra to determine their EMI.

  • Access MyMoneyMantra
  • Select Financial Tools and proceed with choosing the EMI Calculator
  • Enter your loan amount
  • The rate of interest
  • Repayment period in months
  • Click on 'Calculate'
  • Get your EMI and details of principal and interest repayment over the entire tenure

How to Apply for a Home Loan with RBL Bank?

  • Access the official website of RBL Bank and apply online. Fill the loan application form consisting of details like your name, product, city, and email ID along with your phone number. RBL Bank's representative will call to complete the formalities.
  • Visit the nearest branch of RBL Bank and complete the loan application at the branch
  • Apply for the RBL Home Loan through MyMoneyMantra:
  • Access MyMoneyMantra
  • Select Home Loans
  • Submit the details asked for one by one
  • Provide your mobile phone number to receive the OTP
  • Enter the OTP sent to your mobile
  • Get access to different kinds of Home Loan products on offer from various banks
  • Choose RBL Bank and proceed with applying for the Home Loan online

RBL Bank Home Loan - Advantages of Applying for the Home Loan through MyMoneyMantra

  • Get access to all Home Loan products on a single screen
  • Select the appropriate one
  • MyMoneyMantra Home Loan executives are available to guide you through the process
  • This facility is available free of cost

RBL Bank Home Loan - Mode of Repayment

RBL Bank Customers

  • Submit post-dated cheques in advance
  • Set up SI on your savings accounts to deduct the EMI on time
  • Use internet banking and mobile banking channels to pay the EMI
  • Visit the nearest branch office to deposit cash

Other Bank Customers

  • Post-dated cheques
  • Set up ECS mandate
  • Use internet banking to remit funds using NEFT/IMPS/RTGS
  • Pay cash at the nearest RBL Bank branch office

RBL Bank Home Loan - Frequently Asked Questions

Has RBL Bank adopted the RLLR structure for determining interest on Home Loans?

No, RBL Bank has not yet formulated a retail loan product to link with the RLLR. The deadline for all banks in India to do so is October 01, 2019. Maybe RBL Bank could come up with a suitable product by then.

If MCLR is a market-related rate, why should the bank switch to the RLLR?

MCLR is a market-related interest rate. However, banks are not quick enough to pass on the benefits of the market fluctuations to the customer. The banks announce MCLR every month, but the reset usually happens at quarterly intervals. The RLLR has a better connection with the external benchmark rate. Hence, it ensures greater transparency. Secondly, the method of determining the RLLR is comparatively easier to the MCLR.

How does the MCLR revision affect the Home Loan interest rate?

The MCLR reset date is the crucial date for any Home Loan account. The Home Loan interest rate changes from that day. In the case of an increase in the MCLR, the corresponding Home Loan rates will rise. At the same time, a fall in the MCLR rates can bring down the Home Loan interest rates.

How will the rate change affect the EMI or repayment?

Ideally, the EMI should move up or down following the movement of the Home Loan interest rates. However, banks prefer to keep the EMI constant and vary the loan repayment tenure. Under such circumstances, the mandate will increase with a rise in the MCLR and reduce with a fall in the corresponding Home Loan interest rate.

Is it beneficial to the customer if the EMI remains constant and tenure changes accordingly?

This procedure is not beneficial to the customer, especially in the case of the extension of the tenure. The borrower ends up paying a higher amount over the entire tenure. An increase in the EMI could cause an immediate rise in loan liability but is beneficial in the end.

How is the daily reducing balance interest calculation method better than the monthly reducing balance?

Many private banks and HFCs adopt the monthly reducing balance method of calculating interest. In this system, the interest for a month is calculated on balance outstanding on the last day of the previous month. It does not consider the payment of EMI during the month for calculating interest. On the other hand, the daily reducing balance method gives the benefit of repaying the EMI during the month. This example will help you understand better.

  • Balance outstanding on June 30: 2.50 Lakhs
  • EMI paid on July 10: 0.50 Lakhs
  • Interest for July calculated on balance outstanding on June 30, 2.50 Lakhs
  • The customer loses the interest for 21 days on the EMI paid on July 10

Is there any prepayment or foreclosure penalty in RBL Bank Home Loans?

Customers opting for floating-rate loans do not incur any penalty on foreclosure or prepayment of Home Loan. Borrowers opting for the fixed rate of interest do not pay any penalty if the amount of payment is up to 15% of the outstanding amount in a month. If the payment goes above 15%, the penalty is 3% of the balance outstanding on the day. In the case of a foreclosure, the penalty is 3% of the foreclosure amount.

How does the Easy Home Loan product save money for the borrower?

The Easy Home Loan product allows the borrower to link the current account with the Home Loan. The balance in the current account is added to the loan balance for interest calculation purposes. Thus, the borrower saves on the interest component.

Is it advisable to opt for a fixed-rate Home Loan in RBL bank?

The rate of interest on the fixed rate of interest Home Loan in RBL Bank is 13.50%. On the other hand, the floating rate is in the range of 10.30% to 12.15%. Therefore, the floating rate of interest is beneficial, as compared to the fixed rates.

Will I get tax benefits on my Home Loan interest and principal repayment at RBL Bank?

Yes, tax benefits are available for Home Loan interest and principal amount repayment.

  • Sec 24: Interest repayment up to 2 Lakhs per annum
  • Sec 80C: Principal repayment up to 1.50 Lakhs per annum

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