My rate of interest is linked to Prime Lending Rate(PLR)/Floating Reference Rate(FRR). How will it be affected by the rate change?
PLR and FRR has decreased by 5 bps. New PLR is 17.45% and FRR is 15.45%.
This change in PLR and FRR will decrease the interest rate of those loans whose loan is bench-marked to FRR/PLR by 0.05%.
Why is the reset done from July 1, 2015?
For all home loans with first disbursal before July 4, 2006 the rate of interest will be reset on QUARTERLY basis.
Thus, the change in the rate of interest will be effective from the next reset date i.e. from July 1, 2015.
For all home loans with first disbursal on or after July 4, 2006 the rate of interest will be reset on MONTHLY basis.
The reset dates for affecting the rate of interest changes for these existing customers will be the first date of the coming month after reset.
Thus, the change in the rate of interest will be effective from the next reset date i.e. from July 1, 2015 as applicable.
I am an existing customer of home loans and have taken the loan on floating rate. How will the change in rate affect me?
In case your loan is linked to I-Base the rate of interest on your loan would decrease by 0.05%.
Loans linked to FRR and PLR the rate of interest will decrease by 5 basis points (i.e. 0.05%), due to the change in the FRR/PLR on June 26, 2015. This will correspondingly, impact your EMI or tenor.
What is the impact as my floating rate loan is fully disbursed?
In case your loan is fully disbursed and is on FRR/PLR Benchmark, the rate of interest on your loan will be decreased by 5 basis points (0.05%). In case your loan is fully disbursed and is on I-Base, the rate of interest on your loan will be decreased by 5 basis points (0.05%). The new PLR/FRR/I-Base will be applicable from the next reset date as per FAQ number 4.
I have taken a sanction on floating rate and have not availed any disbursement till date, how will the change impact me?
The margin communicated to you in sanction letter will be applicable (valid for one month). So the effective rate would decrease by 5 bps. After one month, then applicable rate of interest would apply.
What is my new loan tenor? OR by how many months will my loan tenor decrease?
Your new loan tenor would be dependent on the number of years that are remaining for your loan and your rate of interest.
This rate change will impact your EMI or tenor. For further details, you can also walk into your nearest ICICI Bank Loan Servicing branch after July 1, 2015.
(This is applicable for fully disbursed loans on FRR/PLR/I-Base only)
What is my new EMI? OR how much has my EMI decreased by? Will my current EMI cheques have to be changed and where do I have to submit them?
This rate change will impact your EMI or tenor. We will be sharing a text communication regarding the same after July 1, 2015. The same communication will include the process for changing your EMI.
In case of further clarifications or to know about the reset process, you can also visit your nearest ICICI Bank Loan Servicing branch after July 1, 2015.
What should I do to change my EMI? Will there be any charges if I want to change my EMI?
This rate decrease will impact your EMI or tenor.
For more details on the process for EMI change you can contact our nearest ICICI Loan Servicing branch. There would be no additional charges applicable for changing your EMI.
For non ECS/RECS location please carry 36 cheques with you, as the earlier cheques would need to be replaced.In case you have opted for ECS as repayment mode for your loan and your final disbursement was taken after July 1, 2007, you are requested to come to our branch and submit a new ECS mandate form.
However, in case you have opted for ECS or AD as your mode of repayment and your final disbursement was taken before July 1, 2007, you don’t need to change the current mandate.
I have just switched my loan to floating rate of interest, how will the changes impact me?
If you have switched to floating rate and have availed full disbursement, the new rates will be applicable to your loan from the next reset date i.e. July 1, 2015.
For all past disbursements, the new rates will be applicable on the disbursed amount from the next reset date i.e. July 1, 2015.
When you avail of further disbursement, the fresh disbursements will be at new rates.
I had taken a loan under Initial/Renewable Fixed rate scheme. How will this change in FRR/PLR/I-Base impact me?
The change in FRR/PLR/I-Base will not have any immediate impact on your EMI as your rate is fixed for the first one/two/three/ten or renewable two/three/five/ten years from the date of first disbursement. After completion of fixed tenure your rate changes to floating and the benchmark rate applicable then will determine what rate you will pay.
I am Initial /Renewable fixed rate home loan customer. What happens when my fixed rate tenure ends?
Under fixed rate home loan, your loan is fixed for a specified period as communicated to you in the sanction letter. Post completion of the fixed rate period, your loan would convert to floating rate. The applicable floating rate is determined based upon the benchmark rate at the time of completion of fixed rate period. Your effective floating rate would be benchmark rate plus margin that was communicated to you at the time of sanction.
For example the interest rate on your home loan is changing from fixed to floating w.e.f. from July 1, 2015. The applicable floating interest rate would be calculated basis the following methodology:
- Margin (communicated at the time of sanction) : 1.0%
- Benchmark rate (Prime Lending Rate/FRR/I-Base) : I-Base at 9.70%
- Effective floating rate (1 +2) : 10.70%
I am a fixed rate loan customer, what is the new rate in my case?
If you have opted for complete tenor fixed rate of interest there is no impact on rate of interest.
(a) I have availed full disbursement how will the rate change impact me?
There would be no change in your rate.
(b) I have taken a part disbursement how will this change in interest rate affect me? What rate will I get?
If you have taken a fixed rate loan, the rate of interest on the already disbursed amount will not change with the FRR/PLR/I-Base change.
For your balance loan amount the rate applied would be as applicable at the time of disbursement. The rate of interest on the total loan will be the weighted average rate of interest.
I have just switched my loan to fixed rate of interest, before June 26, 2015, how will the changes impact me?
If you have switched to fixed rate and have availed full disbursement, the new rates will not impact your loan.
If you have switched to fixed rate and have availed part disbursement, the rate of interest on the already disbursed amount will not change. For your balance loan amount the rate applied would be as applicable at the time of disbursement. The rate of interest on the total loan will be the weighted average rate of interest.
How will the new rate affect my tax savings / IT benefits?
The total interest payable by you i.e. inclusive of the interest amount would qualify for deduction under Section 24 for Income Tax purpose up to limit as defined in act. So you will continue to enjoy the tax benefits.
Principal repayments would qualify for deduction from taxable income under Section 80C up to overall limit as defined in act.
I had availed of a home insurance Home Safe Plus / Home Protect. How will it get affected due to the change in rate of interest?
In case you have availed of Home Safe Plus by ICICI Lombard, the insurance cover is applicable for a period of 5 years from the first disbursement of the home loan and will continue to be applicable for the 5-year period.
In case you have availed of Home Protect by ICICI Prudential, the insurance cover is applicable for original loan tenure and will continue to be applicable for the original loan tenure. The insured amount is the loan outstanding (as per the original amortization schedule) at the time of death.
Change in rate of interest will not effect the terms of insurance cover.
Can I change my current loan from a floating rate home loan to a Initial fixed rate home loan (1 year fixed / 2 year fixed / 3 year fixed/10 year fixed) ? What will be the rate that I will get ? Are there any fees that I will have to pay for conversion?
Yes, you can change your current loan from a floating rate home loan to a Initial fixed rate home loan (1 year fixed / 2 year fixed / 3 year fixed/10 year fixed).The fixed rate of interest for home loans would be the prevailing rate as applicable at the time when you approach Loan servicing branch for conversion from floating rate home loan to initial fixed rate home loan (1 year fixed/ 2 year fixed / 3 year fixed/10 year fixed).
To change from floating rate home loan to initial fixed rate home loan (1 year fixed / 2 year fixed / 3 year fixed/10 year fixed) you will have to pay a conversion fee of 0.50% (+ applicable Service Tax) on your outstanding loan amount at the time of such conversion. For partly disbursed and EMI under construction cases conversion fee would be 0.50%(+ applicable Service Tax) on the original sanction amount.
What is the process for changing from a floating rate home loan to a initial fixed rate home loan (1 year fixed / 2 year fixed / 3 year fixed/10 year fixed)?
For changing from a floating rate home loan to a initial fixed rate home loan (1 year fixed / 2 year fixed / 3 year fixed/10 year fixed) you will have to execute an agreement for conversion and pay a fee of 0.50% (+ applicable Service Tax) on your outstanding loan amount and for partly disbursed and EMI under construction cases conversion fee would be 0.50%(+ applicable Service Tax) on the original sanction amount. For this you should approach a home loan branch.
Can I close my home loan? What are the charges for prepaying my loan?
- Nil for Home Loans and Home Improvement Loans with floating rate of interest.
- 2% plus applicable taxes on principal outstanding* on full repayment for Home Loans with fixed rate of interest.
- 2% plus applicable taxes on principal outstanding* on full repayment for Top Up loan if the applicant or co-applicant is Non Individual.
- 4% plus applicable taxes on principal outstanding* where loan** is given to Non Individual borrowers or with fixed rate of interest to Individual borrowers. If the loan is sanctioned prior to March 1, 2011 than prepayment charges would be 2% plus applicable taxes.
*Current principal outstanding and all amounts tendered by the borrower towards prepayment of the Facility during the last one year from the date of final prepayment.
**Home Equity Loan/Home Equity Enhancement Loan, Office Premises Loan and Lease Rental Discounting Loan.
Can I make a part pre-payment on my Home Loan Account through NEFT with ICICI Bank?
Yes, ICICI Bank accepts part pre- payment of your Home Loan through National Electronic Funds Transfer (NEFT). In case you want to make part pre-payment on your Home Loan Account through NEFT you need to visit the nearest ICICI Bank branch. For the list of Branches nearest to you please click here. The Service Request number received during branch visit must be mentioned in the remarks column in the NEFT form while making part prepayment through NEFT. Please note that the transactions with invalid request numbers will be rejected.
NEFT is a nation-wide payment system facilitating one-to-one funds transfer. Individuals can electronically transfer funds across the country from one bank to another bank participating in the Scheme.
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