Home Loans FAQs
What is Policy Repo Rate?
What is external benchmark rate of ICICI Bank Limited (“ICICI Bank”) for floating interest rate Home/ Mortgage Loans?
Currently, ICICI Bank benchmarks it’s floating rate Home/ Mortgage Loans to Repo Rate.
What does reset of floating rate loans linked to external benchmark mean?
As per Master Direction - RBI (Interest Rate on Advances) Directions, 2016, floating rate loan means a loan on which interest rate does not remain fixed during the tenure of the loan. Hence, in case of floating interest rate loan, the benchmark rate of the loan gets revised on a pre-defined frequency. As per RBI guidelines, floating interest rate loans linked to external benchmark should reset at least once in three months.
What will be the frequency of benchmark reset for floating rate Home/ Mortgage Loans?
As per Master Direction - RBI (Interest Rate on Advances) Directions, 2016, the interest rate under external benchmark shall be reset at least once in months. Thus, the Repo Rate component of the Interest Rate will be reset on the first day of the third subsequent month from the month in which the Facility is first disbursed (irrespective of the date of disbursement) and every three months thereafter, as a sum of Repo Rate + “Spread”, plus applicable statutory levy, if any. The applicable Repo Rate shall be the rate prevailing one business day preceding the reset date.
Illustration: For first disbursements made in the month of Oct 2019, the first reset date will be Jan 01, 2020 and thereafter on Apr 01, 2020 and so on.
What will be the frequency of change in spread?
As per Master Direction - RBI (Interest Rate on Advances) Directions, 2016, the spread of the facility may undergo change when borrower’s credit assessment undergoes a substantial change, as agreed upon in the loan contract or the Bank could alter the spread once in three years. Thus, in case of any change in spread of the facility, the effective rate of interest may change.
How will the benchmark reset impact the current Rate of Interest (ROI) in case the Repo rate increases or decreases?
On the reset date, if the applicable Repo rate has increased, the effective ROI of the loan account will increase which in turn will impact the EMI/tenure of the loan. In case of decrease in Repo Rate, the ROI will decrease which in turn will impact the tenure of the loan.
Illustration: Consider a scenario where first disbursement of the loan is done on Oct 15, 2019 under RBI Repo linked benchmark rate, with the RBI Repo Rate being 5.15% per annum (as on Oct 14, 2019) with a spread/margin of 400 basis points (bps). In such a case the effective rate would be 9.15% per annum.
In the above scenario, the effective rate of 9.15% per annum would remain constant till the next reset date i.e. Jan 01, 2020. On Jan 01, 2020, the loans would be reset with the applicable RBI Repo rate as on Dec 31, 2019.
Will ICICI Bank discontinue the previous benchmark rates i.e. I-Base/FRR/PLR/MCLR?
For all new floating rate Home/Mortgage Loans sanctioned from Oct 01, 2019, the Bank will only offer loans linked to Repo Rate. However, the existing loans will continue on the respective PLR/FRR/I-Base/MCLR till its repayment.
Will the existing loans booked under PLR/FRR/I-Base/MCLR get automatically reset under Repo linked benchmark rate?
No, the existing loans will continue under the existing benchmark rate.
Will the existing customers linked to FRR//PLR/I-Base/MCLR based benchmark rate be allowed to convert to Repo based pricing?
Yes, all existing customers have an option to switch from the existing system of FRR/PLR/I-Base/MCLR (FRR/PLR/I-Base/MCLR +/- spread) to the new system of Repo linked rate (Repo + spread) at prevailing rate applicable for new loan with the same category of customer.
Illustration: If an existing customer with a loan amount of Rs 2.5 million at 9.10% interest rate (I-MCLR-1Y (8.55%) + 0.55%) and if the customer opts to switch-over to Repo linked rate, then the applicable interest rate will be 8.90% per annum since the applicable ROI for new loan with the same category of customer is Repo rate (5.15%) + 3.50%.
Will the existing customers linked to FRR//PLR/I-Base/MCLR need to pay switch/conversion fee to convert the loan to Repo linked pricing?
Yes, customer will have to pay Switch/conversion fee. For details, the customer will be required to visit the nearest Asset Servicing Branch.
What is the process for changing from an existing benchmark rate of FRR/PLR/I-Base/MCLR to Repo linked benchmark rate?
For changing from existing benchmark rate of FRR/PLR/I-Base/MCLR to Repo based benchmark rate, the customer will be required to visit the nearest Asset Servicing Branch and submit the conversion request letter.
Is full tenure fixed rate loans linked to external benchmark?
Full term fixed rate loans are not linked to any benchmark. The rate is fixed for the tenure of the loan.
Can I close my home loan? What are the charges for prepaying my loan?
The prepayment charges are as under:
- Nil for Home Loan, Land Loan and Home Improvement Loan with floating rate of interest.
- 2% plus applicable taxes on principal outstanding* on full repayment of Home Loan, Land Loan, Home Improvement Loan & Top Up on Home Loan with fixed rate of interest.
- 2% plus applicable taxes on principal outstanding* on full repayment of Top Up on Home Loan if the end use is for business purpose
- Nil for Non Home Loan** with floating rate of interest and the end use is other than business purpose.
- 4% plus applicable taxes on principal outstanding* on full repayment of Non Home Loan** if the end use is for business purpose
- 4% plus applicable taxes on principal outstanding* on full repayment of Non Home Loan** with fixed rate of interest.
*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 payment of your home loan through National Electronic Funds Transfer (NEFT). In case you want to make a part payment on your home loan account through NEFT, you need to visit the nearest ICICI Bank Asset Servicing Branch. The Service Request number received at the branch must be mentioned in the remarks column in the NEFT form while making part payment through NEFT. Please note that NEFT transactions with invalid request numbers will be rejected.
What is the minimum part pre-payment amount that I need to pay when I take a home loan?
The minimum part pre-payment amount should be an amount equivalent to 1 EMI.
If I opt to increase my EMI, can I decrease the EMI in the future?
The EMI once increased will not be decreased at a later date except in case of Part Pre-payment/ Conversion. You may visit to nearest ICICI Bank loan branch for further assistance.
To locate the nearest ICICI Bank Branch, visitmaps.icicibank.com/mobile
How do I get the financial year income tax certificate on my e-mail?
You can make a request for income tax certificate through the following channels:
Online process without login:
Visit our website www.icicibank.com Click on Apply online Click on Statement - Home Loan Click on Continue to Login and enter your 16-digit alpha numeric loan account number, along with any two details from DOB, Loan Amount, EMI Amount, repayment bank account number Click on Submit.
Login to www.icicibank.com with your User ID and Password Main Page Customer Service Service Requests Service Request search Product Select Home loan related Request for Final IT Certificate (Physical).
Login to iMobile Select Cards, Loans Forex icon Select Loan Account Select More Options Select Income Tax Certificate
You may call our Customer Care to get Income tax certificate on your registered E-mail ID. To know the local Customer Care numbers, pleaseclick here
ICICI Bank branch:
You may visit the nearest ICICI Bank Asset Servicing Branch along with your valid ID proof. You may look for the nearest ICICI Bank Asset Servicing Branch on our website www.icicibank.com Find ATM/Branch.
How do I change the e-mail ID in my home loan account?
You can change the e-mail ID in your home loan account through the following channels:
Please login to www.icicibank.com with your User ID and Password > Customer Service > Service Requests > Category - Loan > Loan Accounts-E Mail and Contact Number Updation
Customer Care:You may call our Customer Care to change your mobile number. To know the local Customer Care numbers, please click here
ICICI Bank branch:
You may visit the nearest ICICI Bank Asset Servicing Branch along with your valid ID proof. You may look for the nearest ICICI Bank Asset Servicing Branch on our website www.icicibank.com > Find ATM/Branch.