It is prudent to identify and prune unnecessary expenses during this financial crunch, and you could first start with evaluating your loan portfolio, particularly home loan. You might just realise that you have been paying interest far in excess of current market rates. Why is that so? Because your home loan is linked to marginal cost of funds-based lending rate (MCLR), an internal benchmarking mechanism that was in place until the RBI introduced the external benchmarking regime in October 2019.
All new retail floating- rate loans sanctioned after October 1 have to be linked to an external benchmark. Loans taken prior to this continue to be pegged to older benchmarks. Experts say the new regime ensures greater transparency and better transmission of policy action by the central bank.
In this Simply Save podcast, Moneycontrol's Preeti Kulkarni talks to Vipul Patel, Founder of loan consultancy firm Mortgageworld.in, to know more about this relatively newer mechanism.
Tune in to Simply Save for more.
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