SBI Home Loan EMI Moratorium Review: Cost, Terms, FAQs, & More

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Following RBI’s guidelines on extending financial respite to borrowers in the wake of the COVID 19 outbreak, the State Bank of India earnestly allowed its customers of all term loans and cash credit facilities to apply for an EMI moratorium and defer repayments for three months: March, April, May, June, July and August.

In a bid to extend complete financial aid to SBI customers, the largest lender in the country also allowed customers to opt for a refund, in case they have already paid for March instalment.

SBI divided customers in 3 categories:

1. Those who do not want to opt for COVID Moratorium package
2. Those want to apply for Moratorium and defer repayments
3. Those who want to apply for a refund for March payment

The customers who do not want any loan holiday and want to continue their EMIs and repayments as is, need not take any step. They should continue paying as before.

The second category which wants to opt for Moratorium or Deferment of EMIs & interest payments should send an application (Annexure-I) to stop SI/NACH to an e-mail (as listed in Annexure-II).

Check detailed blog on SBI Moratorium Process:How to Opt for SBI COVID 19 Relief Moratorium & Also Get March EMI’s Refund?

The third category of customers, those who want to apply for a refund, should send an application (Annexure-I) for the same to the mail ID (Annexure-II).

Thus, you can avail of the benefits of the SBI Moratorium scheme conveniently for your Personal Loan, Auto Loan, Consumer Durable Loan, Agri Loan, Credit Cards, Working Capital Credit Line, Overdraft Facilities, Credit Card, etc.

If you have more than one SBI Loan and Credit Card, you can avail of repayment deferment on each of the products. However, herein it is important to assess the cost of availing a loan moratorium.

This calculation is even more significant for Home Loans. For, the burden of Home Loan EMI is usually more than Personal Loans or Auto Loans.

Impact of SBI Home Loan EMI Moratorium on Your Pocket

If you opt to defer Home Loan EMIs:

1. You will get a complete EMI holiday for three months: March, April, May, June, July and August 2020.
2. The loan repayment tenor will extend by the exact number of months.
3. However, the interest will continue to accrue at the contacted rate during the moratorium period.
4. The bank will make a new repayment schedule as per the accumulated interest and unpaid loan amount. This will thus increase the loan amount and number of EMIs at the end of tenure.

Example:

Loan amount:  Rs.30 Lakhs

Tenure: 20 years at RoI: 9% p.a

Moratorium: 6 months

Let’s consider 3 cases wherein Moratorium is opted for residual tenures: 5 years, 10 years & 15 years, respectively.

The table below shows how many EMIs will increase by opting for a 6 month Moratorium.

Thus, the impact of Moratorium will depend on the age of the loan. For long term loans like Home Loans, the cost of interest is high in the initial 5 years, and a loan holiday during this period can indeed cause more burden on your pocket. Before availing of a 3-month deferment on your Home Loan EMIs, you should answer if you are ready to delay the loan by 12 months and pay out extra 9 EMIs.

Opt for Home Loan Moratorium if and only if you are facing severe cash crunch due to the COVID19 pandemic. The option to defer payments should be seen as a last resort to get relief from your loan EMIs.

The two benefits of Moratorium are: It will not hurt your credit score, and you will be able to take a repayment break of three months amid liquidity crisis.

FAQs

✅ What is Moratorium?

The Moratorium is a loan break, i.e., the borrower need not pay any EMI during this period. The current COVID Relief Moratorium is a temporary deferment or postponement of EMIs and Instalments due between March 1 and August 31, 2020.

✅ What is Moratorium Period in SBI Home Loan?

The State Bank of India (SBI) has offered a complete 6 month moratorium as a COVID relief package to its Home Loan customers. All retail loans, Agri loans, and cash credit customers can apply for Moratorium of EMIs & payments falling due between March 2020 to August 2020. Customers are even allowed to opt for a refund for March 2020 payment.

✅ How do I apply for the SBI Home Loan EMI refund under the COVID Relief Package?

In case you have already paid for March EMI of your SBI Home Loan, you can apply for a refund. Write an email as per Annexure-II available at https://bank.sbi/stopemi. The application should be drafted as Annexure-I. You can also submit the application in print or handwritten application at your Home Branch.

✅ If I have an auto NACH/ ECS/ SI set, how do I apply for EMI deferment?

As you apply for Moratorium the bank will not debit the amount from your account. You are required to mail/submit at the local branch an application (Annexure-I) to stop SI/NACH to an e-mail (as listed in Annexure-II).

✅ How to apply for Moratorium if I pay my instalments manually?

In this case, no action is required from your end. You can start paying EMIs after the completion of the moratorium deadline.

✅ How do I Opt-Out of SBI Moratorium for my Home Loan?

No action required. You can continue servicing loan as before.

✅ Can I get EMI deferment on SBI Credit Card, SBI Car Loan, SBI Education Loan & SBI Personal Loan?

Yes. All Term Loans and cash credit facilities are included in this temporary moratorium relief for COVID affected borrowers. The relief of deferring repayments is available to all instalments falling due between March 1, 2020, to August 31, 2020, i.e., Principal and interest components, bullet repayments, EMIs & cash credit bills.

✅ Are my EMIs going to be waived after Moratorium?

No. EMIs will only be deferred/ postponed.

✅ Will interest be waived off for 6 months of Moratorium?

No. Interest will continue to accrue during the moratorium period.

✅ How do avail of Moratorium on more one SBI loan account?

You can mention the detail of each account in the mail and apply for Moratorium.

✅ Is COVID Moratorium compulsory for SBI Customers?

No. This is entirely optional loan deferment.

✅ Will deferring My Home Loan EMI impact my Credit report?

No, there will be no impact on the CIBIL report as the bank is not going to report this history.

✅ Will my loan account turn NPA because of deferring three EMIs?

No. There will be no change in asset classification during the Moratorium offer under current circumstances.

✅ Are there any charges involved for three months COVID related Moratorium?

No, there are no charges involved.

✅ How will I pay future EMIs after deferring payments for 3 months?

The bank will share the new repayment schedule. The bank will extend the tenure by exact number of months as of Moratorium. Additionally, more EMIs will be added as per the capitalised interest during this period.

✅ Will EMI Moratorium increase my future SBI Home Loan EMI?

No.

✅ How do I apply for Moratorium without a refund for March?

Apply for Moratorium as discussed above, and do not apply for a refund.

✅ Can I get a deferment of EMI for one month and pay in another month?

Yes, you are allowed to pay as per your convenience. However, do communicate the same to the bank.