SBI Home Loan- Major setback for common people. The country’s largest public sector bank, State Bank of India (SBI), has increased the interest rates on its home loans and other related loans. These new rates have come into effect from August 1, 2025. Actually, RBI had kept the repo rate stable at 5.55% in the monetary policy of August 2025, but despite this, SBI has changed its interest rates.
How much did interest rates increase?
According to the new rates of SBI, the interest rate on regular home loan (term loan) will now be between 7.50% and 8.70%. Earlier this upper level was 8.45%, that is, now it has been increased by 25 basis points. However, the lower limit remains at 7.50%.
According to the data on the bank’s website:
Home Loan (Term Loan): 7.50% – 8.70%
Home Loan MaxGain (OD): 7.75% – 8.95%
Top Up Loan: 8% – 10.75%
Loan Against Property (P-LAP): 9.20% – 10.75%
Reverse mortgage loan: 10.55%
YONO Insta Home Top-up Loan: 8.35%
How will it affect EMI?
This decision of SBI will directly affect those customers whose credit score brings them to the upper limit of interest. Now the difference in EMI will be clearly visible.
For example, if a customer takes a home loan of Rs 50 lakh for a tenure of 20 years:
At new rate (8.70%): EMI will be Rs 44,026. Total interest will be Rs 55.66 lakh, i.e. total payment will be more than Rs 1.05 crore.
At old rate (8.45%): EMI would be Rs 43,233. Total interest Rs 53.75 lakh, i.e. total payment is more than Rs 1.03 crore.
This means there will be a difference of Rs 737 in the EMI every month , which will put an additional burden of around Rs 1.9 lakh in 20 years .
Why was the change made?
SBI says that home loan rates depend on CIBIL score and all these are linked to external benchmark rate (EBLR). Currently EBLR is at 8.15%. Increasing rates makes it easier for the bank to cover credit risk, but it directly affects the pockets of the customers. Due to this move of SBI, the pockets of people thinking of buying a new house will be a little loose. The increased burden of EMI will affect the budget. In such a situation, before taking a home loan, customers will have to pay special attention to the interest rate and their credit profile.