A recent press report said that the banks have decided to extend the tenure of the home loans after stimulation of the Government and the fear of risks to asset quality. Many public sector banks such as State Bank of India, Central Bank, Syndicate Bank and Canara Bank have decided to increase the period of repayment of home loans to 25 to 30 years or until the borrower attains the age of 70 years.
The lead of extending the time period of home loans by 10 years or up to 30 years was taken by State Bank of India whereas the other banks have accepted to extend the tenure of the loan on request.
A senior official of SBI told that the bank has decided to increase the tenure of home loans by up to 10 years to 30 years and until the borrower attains the age of 70 years, depending upon the profile of the customer.
The RBI has recently hiked key interest rates by 25 basis points, which is its 12th such hike since March, 2010. The RBI is hiking the rates constantly in order to control the growing inflation.