Punjab National Bank Home Loan Interest Rate at 9.40% onwards

How to apply PNB Home Loan under Pradhan Mantri Awas Yojana (PMAY)?

First of all, you apply for home loan from PNB and along with your loan application, you need to fill the Pradhan Mantri Awas Yojana (PMAY) Form and submit it with your loan application form with the bank. Bank will take care of its processing. Bank will check your eligibility and if you are eligible in the category you have applied for like EWS/ LIG/ MIG-I/ MIG-II, then accordingly the interest subsidy would be credited in your bank account.

(5) PNB Gen-Next Housing Finance Scheme For Public: This scheme offers Housing Loan to provide housing finance to Gen-Next salaried class borrowers such as IT Professionals, PSBs/ PSUs/ Govt. Employees.

Important Features:

1. Purpose:To extend home loan for purchase of ready to move in house/ flat, for construction of house/ flat, for purchase of under construction flat of approved private builder.
2. Eligibility: All salaried employees with minimum 3 years experience. Co-borrower will also be salaried class. Borrower's age of 40 years, co-borrower's age may be max. upto 45 years
3. Mandatory Condition: Term insurance of at-least equal to loan amount be mandatorily obtained.
4. Loan amount is calculated as 1.25 times the loan amount calculated as per the regular housing loan method
5. Minimum Loan Amount: Rs. 20 lakhs
6. Maximum Loan Amount: No cap
7. Margin: 20% to 25%
8. Maximum Tenure: Max.30 years
9. Security: Equitable| registered mortgage of the property
10. Interest Rate (Repo Linked Lending Rate (RLLR)) (For LTV Ratio of up to 80%):

    Loan Amount	Interest Rate p.a.
    Upto Rs.30 Lakhs	8.45% to 10.10%
    Rs.30 Lakhs and Above	8.40%

Tax Benefits of availing Home Loan

There are two types of tax benefits associated with home loan for Resident Indians:

Repayment of the Principal Amount: One can get a Tax rebate under section 80C of the Income Tax Act on whole amount repaid by him in a financial year, maximum upto Rs. 1,50,000/- each financial year (Increased from 1 Lakh to Rs. 1.5 Lakh in Budget 2014).

Repayment of the Interest on Home Loan: Tax Benefit on Home Loan for payment of Interest is allowed as a deduction under Section 24(1) of the Income Tax Act. One is eligible for a Tax Rebate of maximum of Rs. 2 lakh per financial year for home loan interest paid by him/her during that financial year.

What is the Impact of MCLR on EMI of PNB Home Loan Borrowers?

After April 1, 2016, all bank loans (including home loans) are linked to the bank's MCLR with or without a mark-up or spread (bank margin). Earlier, they were linked to the bank's base rate. All banks are required to disclose their MCLR each month.

Banks generally hike MCLR, whenever there is a hike in Repo Rate by the RBI. Banks may increase MCLR due to surging bond yields and higher provisioning requirements, even when the RBI has not hiked Repo Rate.

Home Loan Interest Rate can be equal to the MCLR or have a 'margin' or 'mark-up' or 'spread' but can never be lower than MCLR.

Home Loan Interest Rate is linked to the bank's MCLR. If MCLR goes up, the home loan rates will also go up. Home Loan Interest Rate will not be impacted by hike in MCLR only if banks reduce the mark-up (margin) in the home loan. If MCLR goes down, the home loan rates will also go down.

For MCLR-linked home loans, the rate is reset after 6 or 12 months according to the agreement between the borrower and the bank. The interest rate applicable on the reset date will become the new rate on which the future EMI's will be calculated.

What Should Base Rate Home Loan Borrowers do?

Home Loan Interest Rate of old home loan borrowers (who had taken home loans before April 1, 2016) are linked to the base rates of the banks. Hence the EMI which they are paying is also linked to base rate. Banks have always remained very sluggish for passing on the benefits of RBI rate cuts to the borrowers.

Now after April 1, 2016, Home Loan Interest Rate is linked to MCLR (Marginal Cost of funds based Lending Rate) for home loan borrowers in order to resolve the problems of the Base Rate regime.

It will be beneficial for them to switch to MCLR linked rate if the difference between what they are paying (under base rate) and what the bank is offering (under MCLR) is significant. So they must switch to MCLR linked rates, if outstanding loan is high and the remaining tenure is also long.

In that situation, Base Rate Borrowers have following two options:

(1) Switch to MCLR linked home loan with the same bank: It is beneficial, in case the bank is charging a nominal switching fee such as 0.50% or less on outstanding amount.

(2) Transfer the loan to another bank on MCLR: It is feasible, if new bank has waived off processing fee (which they generally do in order to attract the customer and increase their business) or is charging very less processing fee and legal and transfer costs.

The borrower must compare both the above-mentioned options and opt for the one which is more beneficial to them in terms of money saved. It will result not only in reduction of future EMIs but also a huge amount of interest will be saved during remaining tenure.

One may as well continue the loan on base-rate especially if the maturity is near and need not go through the process of conversion.

Further, the Reserve Bank (RBI) is going to link the base rate for loans given by banks to the MCLR from April 1, 2018. Once it happens, the base rate will automatically increase or decrease along with the MCLR without any specific action required for adjustment. This will be very beneficial for the home loan borrowers whose rates (EMIs) are still linked to the base rate.

EMI Payment Methods of PNB Home Loan

You can repay PNB home loan in any of the following methods:

(1) Electronic Clearing Service (ECS): Electronic Clearing System is preferred for faster payments and collections. If you have an account with other bank than PNB then you can use ECS for loan repayment. You will have to fill up a form and submit the same with your bank for debiting EMI every month from your account. In this case, your EMI will be automatically debited every month from your bank account and credited to PNB towards loan repayment instalment.

(2) Standing Instruction (SI): If you maintain your account with PNB, then you can use this method. Under this method, you will have to issue a Standing Instruction to PNB to debit your EMI amount on a due date every month from your PNB account and credit to PNB loan account towards loan repayment instalment. You save a lot of time and energy by giving standing instructions to the bank to carry out the transaction on your behalf each time.

(3) Post-Dated Cheques (PDCs): In this method, you need to submit post-dated EMI cheques to PNB for a certain period of time, which are deposited by the PNB on the due date. This alternative is cumbersome and time-consuming and involve a manual procedure of visiting the PNB in a timely manner.

Points to Note Regarding EMI Payment Methods

1. A fresh set of PDCs need to be submitted in a timely manner.
2. Post Dated Cheques are accepted only for non-ECS locations.
3. It is good to pay your EMIs either through the Standing Instruction or ECS for faster and timely remittance of your loan instalments.

In case of Prepayment of Punjab National Bank Home Loan, will EMI change?

One can pre-pay Punjab National Bank Home Loan without any prepayment charges as it allows prepayment at nil charges in case of floating rate home loans. If the borrower makes a prepayment, the outstanding balance of principal amount of his home loan reduces. Then in that case he has following 2 options:

1. He can continue with the existing and reduce the loan tenure
2. He can reduce the EMI and keep the loan tenure the same

Out of above 2 options, first option is more beneficial for the borrower as he pay less interest to the bank as the pay off home loan will be faster.

Ways to Reduce your PNB Home Loan EMI

• Negotiate with your banker on lower interest rate
• Apply for longer tenure
• Give maximum amount as down payment
• Pre-pay loan amount
• Switch to another bank/ FI offering lower interest rate

Latest News on PNB Home Loan

• September 1, 2024: PNB revises MCLR for all tenures w.e.f. 01.09.2024
• February 1, 2024: PNB revises MCLR for all tenures w.e.f. 01.02.2024
• October 1, 2021: PNB cuts MCLR for all tenures by 5 basis points i.e. by 0.05% w.e.f. 01.10.2021
• April 13, 2021: Punjab National Bank launches PNB@Ease, now the customers need not visit branch to open accounts or avail loans
• January 23, 2020: Punjab National Bank has decided not to sell shares in its subsidiary PNB Housing Finance and maintain a minimum 26% shareholding as a promoter
• January 14, 2020: Punjab National Bank (PNB), the anchor bank for the merger of Oriental Bank of Commerce, United Bank of India and Punjab National Bank, has appointed Ernst & Young (EY) as a consultant for the process
• January 1, 2020: PNB has revised the base rate from 9.25% to 9.05%
• January 1, 2020: Punjab National Bank has revised the Marginal Cost of Funds based Lending Rate with effect from 01 January 2020
• December 27, 2019: Punjab National Bank (PNB) raises Rs 1,500 crore via Tier - II Basel III compliant capital bonds to use the funds for business expansion
• August 28, 2019: Punjab National Bank (PNB) launches repo rate-linked retail loans. Under this new scheme, interest rate will be 0.25% less than the existing rates based on MCLR. PNB's existing home loan customers can also apply for new RLLR (repo linked lending rates) with minimal charges
• June 1, 2018: PNB hikes MCLR for tenures from 6 months and above by 10 basis points i.e. by 0.10%
• March 12, 2018: PNB is planning to dilute stakes in its subsidiaries and sell non-core assets to improve its capital base.
• December 5, 2017: PNB raises Rs1,315cr through stake sale in PNB Housing Finance.

FAQs on PNB Home Loan

1. What is an EMI?

   EMI or Equated Monthly Instalment is a fixed amount paid by you to the bank on a specific date every month. The EMI's are fixed when you borrow money from the bank as a loan. EMI's are used to pay both interest and principal amount of a loan in a way that over a specific number of years, the loan amount is repaid to the bank alongwith interest.

2. What is Pre-EMI Option?

   Pre-EMI is an option in which the borrower has to pay only interest on loan amount during the progress on the construction of the project. The actual EMI payment will be started only after his/ her possessing the house.

3. What are the various interest rates offered on home loans?

   Interest rates offered vary for women borrowers and others. Women borrowers are offered home loan at lower interest rate in PNB.

4. What is the eligibility criteria for getting PNB home loan?

   The eligibility criteria will be your repayment capacity which is determined by PNB based on various factors like age, income, credit history, value of the property, relationship with bank, etc.

5. Can joint-applications be made for PNB Home Loans?

   Yes. Joint applicants can be made for PNB Home Loans.

6. What processing fee is charged by PNB home loan?

   PNB charges a low processing fee for its home loans which is as mentioned below:

   • Upto Rs 3 crore: 0.50% of Loan Amount (Max. Rs 20,000)
   • Above Rs 3 crore: Rs.50,000
   • Applicable tax will also be charged
7. What are the maximum number of properties that I can own?

   You can own as many properties as you want.

8. What is a down payment?

   Down payment is the amount that is paid by the borrower on an up-front basis. Banks usually pay around 75% to 85% of the cost of the property, hence the rest amount the borrower needs to pay as down payment.

9. What is the average tenure of a home loan?

   Home loans average tenure ranges generally between 3 and 30 years.

10. Can I pre-pay my PNB home loan? Is there any penalty?

    Yes. You can pre-pay your PNB home loan with upto 2% of pre-payment penalty for fixed interest home loan.

11. What security do I need to furnish for PNB home loan?

    The property purchased out of the loan is taken by PNB as the security. However, if PNB feels then it can ask for additional securities too.

12. I am a Govt. Employee. Is there any loan provided by PNB that will suit me?

    Yes. PNB offers PNB Pride Housing Loan for Government Employees which is exclusively designed for Govt. Employees. It will be best for you.

13. Who is an NRI?

    NRI or Non Resident Indian is a citizen of India or a foreign national of Indian origin living outside India for the purpose of employment, business or any other vocation, which would indicate his intention to stay outside India for an indefinite period of time. An Indian would also be termed as an NRI if his stay in India is less than 182 days.

14. What is the mode of payment for NRI home loans?

    Generally, payments are made through NRI Account like NRO, NRE, NRNR and FCNR accounts. NRI home loan can be paid by way of direct remittances from abroad through normal banking channels or from other financial accounts as may be permitted by RBI.

15. What kind of job makes me eligible for PNB home loan?

    You can either be a salaried employee or self-employed for obtaining this loan. However, the only condition is that you should be earning a regular income and should be able to furnish proofs of the same.

16. What is the tax benfits available on PNB home loan?

    As per Section 80C of the Income Tax Act, in case of the principal amount, you can claim a deduction of upto Rs 1.5 lakhs while in case of interest, it is upto Rs. 2 lakhs.

17. Are long-term home loans beneficial or short-term loans?

    It dependes on the financial status of the borrower. If he wants lower EMIs then Long-term loans, if not, then he can go with short-term loans with higher EMIs with the benefit of lesser interest.

18. Do I have to pay only fixed rate of interest or floating rate is also there in PNB Home Loan?

    No, you have the option to choose any kind of rate of interest you want to pay. You can pay floating rate of interest which is linked with the MCLR and keeps changing from time to time.

19. My EMI is increased due to an increase in the rate of interest being it flexible. What do I do for lower EMI?

    EMI increases with the increase in the rate of interest if you have opted for floating rate. You may ask your bank for increasing the loan tenure, if you want to get your EMI reduced or you can make some part pre-payment to your bank for reduction in EMI.

20. What are different modes of payment of EMI of PNB Home Loan?

    The EMI can be paid through various modes such as Post dated cheques, Electronic Clearing Service (ECS), Standing Instruction (SI), etc.

21. Can I apply for a home loan to renovate my home or flat?

    Yes, you can apply for home loan for any purpose such as buying a home, constructing a home, repairing of your home, home improvement, balance transfer and home renovation.

22. What is the difference between EMI and Pre-EMI?

    You repay your home loan through Equated Monthly Instalments (EMI), which includes principal and interest component. EMI repayment starts from the month subsequent to the month of final disbursement. Pre-EMI is only a simple interest, which you are required to pay every month till the loan is not fully disbursed.

23. How to get my Income Tax certificate from PNB?

    Income Tax certificate will be despatched to your after the end of financial year by PNB. You may also contact your nearest PNB branch or your can also send a request through its website for the same.

Contact details of Punjab National Bank, Punjab National Bank SMS balance check number SMS banking, Punjab National Bank mobile banking, Punjab National Bank toll free number,Punjab National Bank toll free number 24*7, Punjab National Bank miss call number.

• MISSED CALL NUMBERS - 18001802223, 0120-2303090
• CUSTOMER CARE NUMBERS - 18001802222, 18001032222, 0120-249000, 011-28044907
• CONTACT NUMBERS - 18001802222, 18001032222, 0120-249000, 011-28044907

Punjab National Bank Contact Details

• BANK OFFICIAL WEBSITE - https://www.pnbindia.in
• CONTACT NUMBERS - 18001802222, 18001032222, 0120-249000, 011-28044907
• EMAIL ID - [email protected]
• MISSED CALL NO. - 18001802223, 0120-2303090
• CUSTOMER CARE NO. - 18001802222, 18001032222, 0120-249000, 011-28044907
• TOTAL BRANCHES - 6560
• TOTAL ATMS - 8348
• HEADQUARTER - New Delhi
• BANK ADDRESS - Plot No 4, Sector -10 Dwarka New Delhi -110075

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