State Bank of India to Hike Loan Limit by 10 Times

State Bank of India will shortly be hiking the loan limit to people purchasing land to construct a house by 10 times. This move by the banking giant is meant to raise its grasp on the home loan segment. According to the proposal signed by the bank, it would lend Rs. 10 crore to people for purchasing land. Previously the limit for the same was Rs. 1 crore, according to a top SBI official.

A top SBI official said, “A customer will also be eligible to avail another housing loan for other housing-related construction on that plot, enjoying the benefit of running both the loans concurrently”. But the bank has fixed the margin limit at around 35% for loans exceeding Rs. 1 crore. For loans not exceeding Rs. 75 lakh, the margin limit has been fixed at 20%.

The official added, “We have a liquidity of over Rs 40,000 crore; schemes such as this will help us achieve our credit growth targets”. But the bank will follow proper diligence, while raising the credit offtake in the home loan sector. The official said, “To minimise fraud risk, two title search reports from different lawyers will be obtained before sanctioning the loan”.