Yes Bank Home Loan Interest Rates

Calculating Home Loan eligibility is a critical part of any Home Loan proposal. Salaried persons or those filing regular IT returns should not have any difficulty in satisfying eligibility norms. However, some self-employed persons have income but do not file income tax returns. The surrogate loan programmes are helpful to such people. Yes Bank gauges their income from other sources like bank statements, invoices, and so on. Such borrowers have to pay a higher rate of interest as compared to regular Home Loan borrowers.

Khushi Home Loan Scheme is for those individuals having income as low as Rs 9,000 per month. These people can apply under the Pradhan Mantri Awas Yojana to avail interest subsidy. If they do not have documentary evidence of their income, they can apply under the surrogate loan programme.

For PMAY interest subsidy calculation, one needs to obtain the Home Loan repayment schedule and find out the present value of interest for each of the 20 years. You can calculate the same using MS Excel tables. Alternatively, the PMAY official website has an interest subsidy calculator. This calculator is easy to use. The PMAY subsidy is calculated assuming the rate of interest to be 9% throughout the tenure. 

One should note the following points in connection with the PMAY subsidy:

• The loan amount eligible for calculation of PMAY subsidy for each category of borrower is different
• For EWS and LIG, the maximum loan amount eligible for subsidy calculation is 6 Lakhs
• For MIG-I and MIG-II, it is 9 Lakhs and  12 Lakhs respectively
• The notional rate of interest for the calculation of subsidy is 9%
• The subsidy is calculated on the NPV of the interest charged to the account for a maximum of 20 years.
• The subsidy is an upfront one, thereby affecting the EMI of the borrower

This simple example will make it convenient for all.

Consider a PMAY borrower in the MIG-I category who has taken a loan of  10 Lakhs from Yes Bank at 10% interest for 20 years. The EMI works out to  9,650. The borrower is eligible for a maximum subsidy of  2.35 Lakhs. Thus, the principal amount of the loan reduces to  7.65 Lakhs after the credit of the upfront subsidy. Thus, the EMI now reduces to  7,382.

The loan amount is immaterial. The maximum loan amount eligible for calculation is  6 Lakhs for EWS,  9 Lakhs for MIG-I, and  12 Lakhs for MIG-II. Any loan amount more than these numbers is treated as unsubsidised loans.

Yes, Income tax concessions are available under Sec 24 and Sec 80C of the IT Act for repayment of Home Loan interest and principal amounts respectively.

• Interest repayment: Maximum of 2 Lakhs per annum per borrower under Sec 24
• Principal repayment: Maximum of 1.50 Lakhs per annum per borrower under Sec 80C

Yes Bank offers the facility to foreclose your Home Loan or make part prepayments. It does not charge any penalty for foreclosure and prepayments on the floating rate on interest loans. For borrowers opting for a fixed rate of interest, Yes Bank charges a penalty of 2.50% on the principal amount outstanding.

It depends on the circumstances. If the market rate is in a falling regime or remains constant, the floating rate is beneficial. Otherwise, the fixed rate can be a better option.