Who is eligible?
According to the RBI’s broad guidelines, you are eligible for loan restructuring only if the loan account was a ‘standard account’ as on the date of application for relief and not in default for more than 30 days as on March 1 .
Additionally, you should have been affected by the pandemic. Hence, your salary/income in August should have been lower than that in February. Job loss, closure of business or reduced activity in business establishments in case of self-employed, are also conditions under which a borrower can avail the restructuring option
What is the relief you get under restructuring?
Under the restructuring option, a borrower can ask for moratorium on loan EMIs for a period ranging from 1 to 24 months.
A borrower does not pay any EMIs during the moratorium period. At the end of this moratorium period, the borrower has two options – he can either retain the original tenure of the loan or ask for extension of the loan tenure for a period equivalent to the moratorium granted (up to 2 years).
Hence, if you have a residual home loan tenure of 15 years and you have opted for a one-year moratorium, you can either choose to keep the tenure of the loan at 15 years or 16 years at the end of the moratorium.
Based on this, your future EMIs will be determined taking into account the interest rate applicable on your loan.
Hence, your EMIs will undergo a change post-restructuring.
Will interest apply
during the moratorium period? Will there
be an additional charge?
Yes, interest will be charged during the moratorium period. Also, SBI will charge an additional interest of 0.35 per cent over and above your current rate of interest.
If your loan is a variable loan linked to either MCLR or repo rate, and there is a reduction in these benchmarks, then your rate of interest on loan will also reduce accordingly over the moratorium period and the tenure of the loan.
But you will have to pay 0.35 per cent additional interest over the new lending rate through the tenure of the loan.
Will I be eligible if I
currently do not
earn any income?
If you have suffered a job loss and are not earning any income now, you will need to indicate when you are likely to get employed again and what will be your expected salary. Based on this information and your other loan liabilities, SBI will decide the eligibility on a case to case basis
Will my credit score
get impacted?
While accounts restructured under this framework will be maintained as ‘standard’, the impact on your credit score is unclear as of now.
However,loan restructured would be reported to the credit bureaus and it can have some impact on your future borrowing capacity.