percent unless it is waived in addition to other legal and transfer costs one needs to work out the feasibility in terms of savings after accounting for such charges still moving on to mclr works in favour of borrowers if loan outstanding is high and the remaining tenure is long not only there will be reduced emi but also a huge amount of interest can be saved illustratively on a home loan of rs 50 lakh reduction in interest rate by 070 will help a homebuyer to save rs 2496 per month and approximately rs 9 lakh during the loan tenure of 30 years one may as well continue the loan on baserate especially if the maturity is near and need not go through the process of conversion banks on their own typically reduce the tenure automatically and thus transfer the benefit of the lower rate to their customers ask your banker if there is no communication from them new borrowers all bank loans including home loans taken after april 1 2016 are now linked to the banks mclr with or without a spread bank margin earlier they were linked to the banks base rate currently the 12month mclr for most banks is in the range of 89 percent after the markup spread or bank margin the actual home loan rate could be higher any new home loan borrowers should at least consider these two important factors actual lending could be at mclr plus a spread and secondly there is a reset clause in mclr spread the actual lending may or may not be at banks mclr as banks are allowed to add a markup or a spread say the bank mclr is 850 per cent the actual home loan may be fixed at 89 per cent ie with a 040 percent of markup so do not merely go by the mclr but keep an eye on its spread too but remember spreads may change even if mclr is constant on the reset date reset most banks offer home loans linked to their oneyear mclr ie it is reset yearly so if one has taken a home loan anytime between april 2016 and april 2017 and even though banks mclr comes down in may 2017 the effect of it for the borrower will be seen in april 2017 and april 2018 depending on the month it was taken remember if rates move up in the next 12 months your emis too go up and vice versa in effect there is a waiting period usually a year for the borrowers before they see an impact on their equated monthly instalments emis therefore existing borrowers with mclrbased loans should not expect their emis to fall immediately rbis rate cut if it happens in the next review meet conclusion with the focus on housing for all by 2022 a lower interest rate regime and a fall in the real estate prices would be more conducive in addition the establishment of statelevel rera