bgovernment of indias threemonth treasury bill yield cgovernment of indias sixmonth treasury bill yield dany other benchmark market interest rate published by financial benchmarks india limited fbil existing borrowers what they can do to reduce their emi burden loans linked to external benchmark regime borrowers whose loans are linked to the external benchmark regime will continue to pay the same amount of equated monthly instalment emi as there has been no change in the repo rate loans linked to mclr as the central bank has been cutting rates through the year banks have also reduced their marginal cost of lending rate mclr as per data available on sbis website the bank has reduced the mclr by 55 bps between january and november 2019 however you should remember that impact of the reduction in mclr will only be felt once the reset date of your loan arrives usually a bank offers mclrlinked home loans with a reset period of six months or one year therefore under the mclr regime the interest rate on a loan gets revised as per prevailing market conditions only on its reset dates if you are servicing an mclr linked loan and want to switch to an externally benchmarked one then as per the rbi circular you can do that by paying administrative costs while switching your home loan from mclr to one linked to an external benchmark do check the spread and risk premium charged by the bank and compare with other banks to know which one is offering the cheaper loan also read home loan interest rates linked to repo rate financial planners suggest that one should make a switch only if the interest rate difference between the two is 050 per cent or more also remember that the loans under the externally benchmarked loan regime aresubject to higher volatility as the interest rates charged on your loan will change more rapidly with changes in the external benchmark do keep in mind that when rbi starts to hike key rates your interest rates will go up in tandem with loans linked to base rate or bplr for those borrowers whose home loan interest rate is still linked to the base rate or benchmark prime lending rate bplr you should consider switching your existing home loan to the external benchmark based loan regime according to industry experts external benchmark regime offers more transparency in transmission of policy rates as compared to other rate setting mechanisms new borrowers for new borrowers loans taken by you now will be linked to an external benchmark as mentioned above though the rbi has kept the key policy rates unchanged today any rate cut in the future will bring down your emis if you are planning to take home loan now then eligible borrowers can also look at taking advantage of the pradhan mantri awas yojana pmay the scheme offers creditlinked subsidy based on your annual income under its flagship programme housing for all to avail this subsidy there are some