Loans are used to satisfy a number of needs and wants and tend to form part of the average household’s financial obligations. The correct management of a loan is crucial for customers to get maximum benefit from it. For this, matching the right loan to the need is crucial. State Bank of India Loans provides customers with options. This review compares them to some of the best in the world.
Personal loans that could do with a bit of a revamp are offered through Citibank. We recently did a review on this range.
International Standards and Recent Changes In Banking Policy
In order for India to remain on par on an international level, it’s important that they adhere to some strict guidelines. Of the most recent ones was the implementation of a new ruling where the banks in India are no longer able to keep bad debts on their books. Other types of provision will need to be made to ensure things are on track. It also forces the banks in India to take a closer look at larger defaulters and whether they should proceed with legal action.
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Best Practices for the Effective Management of Loans
Apart from the damage bad loan management could do to a credit score, there are also legal implications. In order to avoid this and have a good loan experience, it’s important that consumers are aware of their loan obligations. This means reading through their loan documents and understanding the terms and conditions. Other important factors also play a role.
Learn To Understand Basic Legal Terms
This will go a long way, especially for those who are unable to read through their contracts and understand the information. With a basic understanding of these terms, customers will know whether it’s in their best interest to sign up for the loan or not. They will also know whether the loan type is suitable for their specific need.
Keep An Eye On the Interest Rates
When the economy takes a dip and the interest rates are pushed up, loan installments also increase. When this happens, customers need to adjust their budgets in order to accommodate these rising installments. This will ensure they cover their payments throughout the duration of the loan and also keep their credit score high.
Take Only What You Need
Loans are sometimes a little too easy to apply for and it often lands customers in trouble when those loans become tough to manage. This is especially the case when customers have over-extended themselves and the loans are getting out of hand. When it comes to financing it’s important to take only what you need to ensure that payments are manageable and the loan repayments don’t become a headache.
Find Out About Payment Holidays
There are those times in life where payments become a little sticky. It’s good to know that many institutions offer clients the opportunity to skip a payment during the term and pay it at the end of the term when a financial hiccup occurs. Although not all banks offer this, many of them do.
State Bank of India Loans Product Offerings
Xpress Credit Personal Loan
This loan type is suitable for those who wish to have funds available to them whenever they need. The funds could be used for a sudden vacation or unexpected medical costs.
- Customers benefit from low interest rates and the interest is charged on a daily reducing balance.
- Furthermore, there are low processing charges and no hidden costs.
- Finally, there is no security required and minimal documentation.
SBI Pension Loan
This is the ideal loan type for those who Central or State Government, or Defense pensioners. Furthermore, the loan is available to those who are no older than 76.
- Loan amounts for pensioners from Central and State Government is a minimum of Rs 25,000. The maximum is determined on a sliding scale due to age and reduces as customers get older.
- The loan amounts for Defence Pensioners is a minimum of Rs 25,000 with the maximum on a sliding scale. This amount also reduces as the customer gets older.
- Furthermore, loan amounts for Family Pensioners are far lower but also have a minimum of Rs 25,000. These also reduce on a sliding scale.
- The repayment periods of the loans are determined by the age of the pensioners.
- Defense Pensioners don’t have to pay processing fees.
- Prepayment charges are applicable on these loans.
- Finally, customers pay a competitive interest rate.
Loans Against Shares
This is the ideal loan types for customers who have a share portfolio but don’t necessarily want to sell them to get access to cash. Furthermore, customers can avail loans of up to Rs 2,000 lacs against their shares.
- The loan is available to existing customers who have a past satisfactory relationship with SBI. They also need to have a DEMAT Account with SBI Cap Sec.
- Currently, the loan is offered as an overdraft or demand loan.
- Furthermore, the loan is only available in a single name.
- NRIs are not eligible for this loan.
- The minimum loan amount is Rs 50,000 and the maximum Rs 2,000 lacs.
- Finally, the demat share will act as security for the loan in the form of a pledge.
SBI Loan Against Time Deposit
This is the ideal loan for those who have a time deposit but an unexpected expense pops up. Furthermore, customers can access up to 90% of the value of their deposit.
- Customers can choose between a demand loan and an overdraft facility.
- The loans also carry competitive interest rates and there are zero processing charges.
- Finally, there are no repayment penalties.
Loans Against Mutual Fund Units
This loan type is suitable for those over the age of 18. Furthermore, it takes place against a list of approved schemes.
- The minimum loan amount is Rs 25,000 and the maximums depend on which product the customer chooses.
- Also, the margins on the loans depend on the products as well.
- Customers enjoy competitive interest rates and processing charges apply.
- Furthermore, this loan also carries a review or renewal fee every year.
Loans Against Property
Customers who require access to additional funds and have equity in their property may want to have a look at this loan. Also, this loan can go towards any personal expense the customer may need, such as education, a wedding, and more.
- This loan is not permitted for business purposes.
- Customers are required to earn a minimum net monthly income of Rs 25,000.
- Furthermore, the maximum age for application is 70 years.
- There is a minimum loan amount of Rs 10 lacs and a maximum of Rs 5 crores, however, this varies from settlement to settlement.
- Loan amounts up to Rs 1 crore have a 65% LTV and those over Rs 1 crore an LTV of 60%.
- The loan repayment is a maximum of 15 years. However, this is subject to the expected life of the property to exceed to loan by more than 5 years.
- Finally, customers will receive their funds by means of a term loan.
This loan scheme provides customers with loans against assignments of future rentals. These rentals could be from residential or commercial properties.
- There are various methods used to calculate the maximum loan amounts. In metros, the maximum is Rs 7.50 crores and in non-metros, the amount is Rs 5.00 crores.
- The loan type also has a minimum amount of Rs 50,000.
- Furthermore, the location of the property also plays an important role.
- The bank will also look at the types of tenants to determine whether they are an adequate income reliance.
Customers who also wish access to savings instead of loans should see what State Bank of India has to offer.
What We Like About State Bank of India Loans
Instead of just offering the straightforward personal loan and merely just branding it a little differently for each need, State Bank of India pulls out all the stops to provide customers with a variety of loan options. There are secured and unsecured options, which opens the playing field a little. Furthermore, these loans meet a multitude of needs.
When it comes to finance it’s also important to know the hairy and scary parts of the deal. The bank dedicates a whole page to this in order to keep clients aware of their responsibilities and the terms of the loans.
Clients are also warned upfront which loans may incur penalties should customers wish to settle them early. The loans are also pretty specific in terms of the requirements, which allows customers to go into the application fully aware of what they need to produce.
Finally, there is a lot of attention to detail with these loans, which means a multitude of options have been discussed before the products were brought to the table. We appreciate this attention to detail as it means customers are in good hands.
What We Don’t Like About State Bank of India Loans
When it comes to an impressive range of loans such as this, what’s not to like? We’re satisfied that the range ticks all our boxes.
Critical Reviews Rating State Bank of India Loans – 10 of 10
Possibly one of the easiest perfect scores we’ve given thus far. A truly remarkable range of products that just satisfy all our requirements. Customers have a range of choices that provide favorable options as well. One of the main criteria we have for banks is to determine the likelihood of a client jumping to another institution because they are unable to meet their needs at the current institution. It is safe to assume customers of State Bank of India who require a loan, will find what they’re looking for in-house.
Another review of State Bank of India that did well, was the mortgages review.