Home loan inquiries top last year’s level

MUMBAI: Because of the strict lockdown in the first quarter of the current fiscal a pent-up demand for home and auto loans has been seen. According to TransUnion Cibil data, home loan inquiry volumes, July and August have crossed last year’s records however they still below January and February 2020. The improvement is being led by public sector banks, which were the first to recommence operations. The revival is being led by public sector banks, which were the first to recommence operations. Private Banks are still getting only three-fourths of last year however NBFCs and finance companies are witnessing half as many applications as the pre-COVID months.
According to the TransUnion Cibil data home loan inquiries have rebounded the most and are 112% of what was seen in July-Aug 2019 but only 92% of January-February 2020 (pre-COVID). Auto loans are 88% of last year’s levels and 84% of the pre-COVID level. Furthermore, the demand for loans against property is at 90% of last year but 72% of pre-COVID.
Lenders send a query to the credit bureau every time a borrower wants to know his loan eligibility. However, credit inquiries may not match loan disbursements all the time. They are a good indicator of demand in the market.
Various public sector banks, including State Bank of India, Bank of Baroda, and Union Bank are offering home loans below 7%. Furthermore, the Maharashtra government is giving incentives on home loans. They have reduced stamp duty of 2% instead of 5% between September and December 2020