Home loan rates over Rs 75 lakh to get dearer as risk weight rises again

Risk weight back to pre-pandemic level of 50%

home loan

Manojit Saha Mumbai

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If you are looking to avail of home loans of above Rs 75 lakh, get ready to shell out more. Rates are set to increase further with the risk weighting on such loans returning to pre-pandemic level of 50 per cent.

In October 2020, the Reserve Bank of India (RBI) rationalised the risk weighting by reducing it to 35 per cent for loan-to-value (LTV) ratio of less than 80 per cent. The relaxation was initially offered till March 31, 2022. In the April 2022 monetary policy review, the RBI extended the relaxation till March 2023. Risk weights were assigned irrespective of the loan amount.

The LTV cap also returns to 75 per cent for loans of over Rs 75 lakh,

First Published: Apr 09 2023 | 10:59 PM IST

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