Axis Bank launches new home loan product
Axis Bank today launched a home loan product that entails waiving off a few EMIs during the course of a loan. The third largest private sector lender will waive off four equated monthly installments (EMIs) each at the end of the fourth, eighth and the 12th year of a two-year loan. This means that if a borrower takes a 20-year loan, the consumer will get 12 of the EMIs waived off, which the bank claimed will help save Rs 3.09 lakh on a Rs 30-lakh loan. The waivers will be applicable for loans of up to Rs 30 lakh and will be given in the form of reduction in loan tenures, it said, adding that the interest rate stays the same at 8.35 per cent. When asked if it will impact the net interest margin as the total tenure is coming down, executive director Rajiv Anand said the bank will benefit from better credit behaviour and longevity of a loan as pre-payments will be less. But a single missed EMI will disqualify the borrower from getting the benefit, while on the longevity front, the incentives can help reduce prepayments, he said.
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