In this article, Gaurav shares his experience procuring the BOB Home Loan Advantage. Gaurav shared this in Facebook Group Asan Ideas for Wealth and upon the suggestion of group admin, Ashal Jauhari has agreed to share it with freefincal readers.
About the author: I am a 38 yr old upper-middle class HR professional with an 18 months old daughter. Personal finance has always interested me. Considering mine is a single income family in a profession that usually doesn’t pay as much as your IT and related jobs – managing money came as second nature (Though I have realized I have a long way to go). So, when it was time to make one of the biggest decisions, emotionally & financially, of my life of buying a house on loan; every penny mattered. As a result – my contribution to this article on the BoB Home loan advantage.
Note: This real-life experience of obtaining an overdraft home loan is published in the hope that it may be of use to readers. This does not imply we recommend the reviewed product or overdraft loans over a normal loan. Please ensure due diligence and choose as per your own circumstances. Now over to Gaurav.
This is my way of saying Thank you to this group for its insights and contribution & a Special Non-Ego Massage Thank you to Jauhari Ashal sir for that 2-min interaction at midnight that helped decide on something critical.
Recently purchased a house and after going through numerous posts, threads, forums & bank visits – finalized on BOB advantage loan. Below is my view, review and detail on the process.
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Even before I had finalized the house, decided that I would go for max gain or a similar OD facility product for the loan. Limited knowledge at that time coupled with Maxgain being all over the group – almost made up my mind to go for it until I stumbled upon BOB.
There are quite a few private banks (Axis was the most preferred option by agents whom I contacted) that provide this facility too.
Overview: I stay in Bangalore and visited their SBI and BOB branches located close to where I stay. SBI’s rates were 6.7% for normal and 6.95% for Maxgain. BOB’s rates were 6.5% irrespective of the loan type till 75L. A .25% increase in the ROI for the advantage product if the loan amount exceeds 75L.
Note: as mentioned by Sewthank Saroj, in the group, this may be a way for BOB trying to increase market share. SBI too had the same rate for normal and OD loans earlier and then made the OD loan more expensive when it became popular.
My loan amount was close to that but did not exceed so got it at 6.5%. An additional .05% as risk liability if you don’t take liability insurance thru them. Processing charges of 10k which is twice what SBI charged since it includes property valuation & legal check. They share the valuation report too. MODT charges were same @ .3%.
Process: Visited the branch and met up with the Loan rep (SBI) and Branch Manager (BOB). Personally, broke the myth for me on how PSU works. Very well, patiently explained the entire process with accurate numbers.
In fact, visited BOB thrice for queries regarding rates, MCLR, Post deciding on BOB, the agent/rep reached out to me. Shared all relevant docs over mail & WhatsApp. Within a week – had the BM and rep visit my house for verification and signatures, within a net of 2 working weeks had my sanction letter ready, DD copy was provided on the same day & original DDs the next day at the time of registration.
Few last-minute queries were raised which delayed the process but that was more to do with my employment history than the bank’s incompetence. Post-registration submitted the originals and was given an acknowledgement proactively. The savings account was opened and activated instantly and the app was up and running though needs a bit of debugging
Learnings: a) At the time of filling the loan application – was told to enter an approximate (higher) amount and tenure so once the sanction letter is given, both amount and tenure can be changed if you want lesser. But to change the same – it’s again a process which takes at least a week.
So, went ahead with what was filled as the loan amount and EMI were both manageable as it was an OD product but a regular loan would have delayed the process even more.
B)Loan amount of more than 55L gets approved & processed at BOB’s Hyderabad centre. If your amount is less than 55L, the branch can approve, process & disburse it.
PS: If you are going thru an agent, he would try and undersell SBI the most to the extent one actually told me that OD is a facade 😃 – I am guessing due to low commission whereas private banks give them more.
PPS: You don’t need an external agent to have your loan processed. Once you visit the bank – your contact details will be shared by the branch manager with their in-house rep who would then call you.
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