SBI Maxgain Home Loan: Review

Updated on December 18, 20185 mins read
SBI Max Gain

(Updated March 2018)

For those who see home loan re-payment as a pain each month, ‘Maxgain Home Loan’, offered by the State Bank of India is a convenient way to save and reduce your interest burden. Simply by clubbing your liquid finances with the home loan account, you can reduce interest burden substantially.

To understand the difference between a normal home loan and a Maxgain home loan, let’s consider the case of Mr. Mehta;

Mr. Mehta recently took a Maxgain home loan from SBI. His outstanding principal is 25 lakhs at an interest rate of 8.60% for a term of 20 years.  (As in March 2018)

Let’s see how having a Maxgain home loan benefits him in different situations;

Case 1:

Mr. Mehta recently received a sum of Rs. 10 lakhs. See how he can use this sum in the case of a Maxgain home loan and a normal home loan to bring his interest burden down;

  • Normal Home Loan:

He can deposit the entire sum of 10 lakhs in the home loan account and prepay his loan, reducing his loan amount to Rs. 15 lakhs. Subsequently reducing his interest burden, but leading to a loss of liquidity. For making the deposit, he will have to go through a long procedure of filling a deposit form, paying a processing fee and will have to make at least  2 visits to the bank.

  • Maxgain Home Loan:

Here, he can park the sum of 10 lakhs in his home loan account, reducing the principal amount on which interest is payable to Rs. 15 lakhs. This means that he will have to pay interest only on the difference of principal amount and the surplus 10 lakhs and not the original principal amount of 25 lakhs. More over, he can withdraw this sum any time simply by en-cashing a cheque or using a debit card, maintaining liquidity of the deposit of 10 lakhs!

Maxgain loan Vs. Normal loan

Maxgain loan Vs. Normal loan

Case 2:

Mr. Mehta urgently needs Rs. 3 lakhs. Let us see the course of action in the case of a normal home loan and a Maxgain home loan;

  • Normal Home loan:

He will have to apply for a top up loan and will have to wait to get approval from the bank. This can take a few days. He may have to pay a processing fee too, depending on the bank.

  • Maxgain Home Loan:

Here, he can simply walk into any branch of SBI and encash a cheque of Rs. 3 lakhs from his Maxgain account!

Maxgain loan Vs. Normal loan

Maxgain loan Vs. Normal loan

So a Maxgain account not only allows you to utilize your liquid savings to reduce interest burden on home loan, but also enables you to use your home loan account like any other savings account.

Here are a few tips to help you maximize your savings in Maxgain home loan;

1. Start using this account as the primary money parking account for all your liquid finances. 2. Route all your transactions through maxgain account (payment of utility bills, online shopping, credit card payments), If possible. 3. You can make use of net banking to schedule a transfer of the EMI amount to the saving bank account, a few days prior to the date of payment. So not only can you park your surplus funds, but also park the EMI payments in the OD account to maximize savings on interest. 4. You can also avail ATM card facility on the OD account or link it to an existing SBI savings account to avail the same. 5. However, any transaction made through a maxgain ATM card from another banks’ ATM will be charged a transaction fee, since it is an over draft account and not a savings account.

Here are a few frequently asked questions by our customers, which will give you a better understanding of Maxgain home loan:

1. Does the SBI charge a higher interest rate on Maxgain loans?

Yes , at present SBI charges 15 basis point more on MaxGain loans. So, the normal term loan is available for 8.55% for borrowers but Maxgain is available for 8.60% (As in March 2018)

2. Does the SBI charge a higher processing fee for Max Gain?

At present, there is no difference in processing fee between Maxgain loans and term loans offered by SBI.

3. Is it mandatory to purchase property or life insurances while taking Maxgain loan?

Yes, it is advisable to have property insurance while taking a home loan. But it is not mandatory to purchase one from any sister concerns of SBI.

4. Can I claim section 80C principal repayment benefit for the surplus amount parked in Maxgain?

Unfortunately, Maxgain does not offer any tax benefit on the parked surplus amount in your OD account, since it is not an actual repayment of loan.

5. Can I enroll my MF SIPs in Maxgain?

Yes, you can. But make sure that there is surplus available balance else you’re ECS or SIP mandate will bounce.

6. If my loan amount is Rs. 30 lakhs and my parked surplus amount is also Rs. 30 lakhs, does it mean that my loan is closed & I can claim my property papers from SBI?

No, your loan is not closed as you have deposited the surplus amount on the OD account. This means that only your interest outgo will become zero and you will still have to pay the principal component of the EMI. If you want to close your loan, inform the SBI in written. Then they will adjust your parked surplus amount towards the outstanding loan amount and your loan will stand closed.

7. I have taken a Maxgain home loan for an under-construction property. Can I park surplus amount to save on interest outgo?

Yes, you can park your surplus funds, but since your property is in the ‘under-construction’ phase, you will not be able to withdraw your funds during this period.

 8. Can I transfer my home loan to Maxgain home loan?

Yes, you can.  Get in touch with your loan manager for the same. Or if you wish to switch home loan from the comfort of your home and have us do all the legwork for you, Sign up here. Make use of the calculator below to see how much you can save by transferring your home loan to SBI’s Maxgain home loan. 9. Is SBI Maxgain a unique product? SBI Maxgain is a home saver loan product. There are other banks that offer such products too. Here is our review on Bank of Baroda home loan advantage, a home saver product. Download SBI Maxgain Amortization Schedule We have countless happy customers who have opted for SBI Maxgain while taking their home loan or switching their loan. For instance, Mr. Jyotirmaya Mishra said , “I truly appreciate SwitchMe executives for their continued support, enthusiasm and dedication towards their job. I can say proudly without their support it wouldn’t have been possible.” Signup for personalised advise, end-to-end service on home loan, and online updates on loan application!



Tarini comes with a degree in Mass Communication and Media studies. She joined SwitchME as a content writer and moved on to being an assistant product manager. Tarini is an experienced Content Strategist with a background in Product development and management. She is skilled in SEO, social media strategy and online content marketing and likes to travel when possible

Have a question? Post it here and we will get back to you within 1 working day.

  1. Jeetendra
    Oct 05 2018 at 2:22 pm

    If I have Max Gain and I Park my money 1) Will bank charge me any extra for parking my money? 2) If I deposit X amount to my loan account will bank charge me extra?
    So is there any locking period that after the loan starts till 1 year bank will charge you X amount for prepay or there is no such rule for max gain we can prepay anytime without any extra money paid to bank.

    • Suma Ganesh
      Suma Ganesh
      Oct 12 2018 at 12:57 pm

      Hi Jeetendra,

      Thank you for writing in to us
      Here are the responses:
      1) The bank will not charge you for depositing funds in any account
      2) Yes, you can prepay your loan at no extra cost

  2. Ganeshkumar M
    Nov 09 2017 at 10:45 pm


    I have a Question here.

    I have taken 50 Lakhs home loan (not MAXGAIN for now) before 2 years. I have been paying EMI through these years and my outstanding Principal is 46 Lakhs. Now, say, I have paid 10 Lakhs as pre-payment. This means that my principal now, after pre-payment should be 36 Lakhs. At this point, I am converting to MaxGain scheme. Will my principal still be 36 Lakhs? Or, will it be 46 Lakhs Principal and 10 Lakhs in the OD account?

    Could you please provide some insight on this?


  3. Vishu
    May 08 2017 at 12:16 pm

    Hello Guys!

    I have Home loan taken from SBI in 2015,Now as per the latest interest rates revision which is MCLR unlik the earlier Baserate plan.
    –>I wanted to know which option is better base rate or MCLR?
    –>Also I am currently in Base rate plan where in the interest rate is 9.3%, And my loan tenure in 15 years,
    I am planning to pay it off at the earliest will it be beneficial for me to move to MCLR plan,also I have heard there is a fee of 10k to move from base to MCLR plan.
    –>Also let me know prepayement and parking excess amount in OD account will earn same benefit except the liquidity.

    Thanku Much

    • Sumita Nath
      Sumita Nath
      May 11 2017 at 3:09 pm

      Hi Vishu,

      Thank you for writing to us.

      1. MCLR rate is more beneficial than base rate as there is a huge difference in its rates and also the rate calculation methodology. As of now SBI MCLR rate for term loan is 8.35%.
      2. Yes, it is beneficial to move towards MCLR plan and the fees that you will have to bear would be 0.35% of your Outstanding loan amount. To know more on your savings benefit you can calculate on our website
      3. You will earn interest benefit on your loan by parking surplus funds.

  4. suryawanshivphal
    Nov 09 2016 at 6:11 pm

    Can we get detailed report from SBI about my maxgain HL for the payments I did till the time and the benefits we see as of now? How to request the same?

    • Sumita Nath
      Sumita Nath
      Nov 28 2016 at 4:29 pm

      Hi Suryawanshivpal,

      You can get the report over email or if you are using net banking you can see it by your-self.

  5. Santosh
    Aug 20 2016 at 2:42 pm

    Hi Tarini,
    First of all, nice explanation above. My question is : We are planning to buy a flat in Bangalore and my wife is a SBI employee, we are planning for a loan of around 32 lakhs. She would get this loan with Interest rate of 6.75% (Staff rate) and I am not sure, if this is the same rate for max gain as well. Considering, she still has a service period of 30 years. May I ask you ,if you could you suggest us which would be better in order for the loan- the normal loan or the max gain.

    • Sumita Nath
      Sumita Nath
      Sep 28 2016 at 3:38 pm

      Hi Santosh,

      I would recommend you to go with max gain as it helps you to repay your loan faster.

  6. rani
    Jul 26 2016 at 2:30 pm

    I took a HL from SBI – scheme named SBI YUVA HL MAXGAIN.
    Is it similar to maxgain account, same way I can park surplus amount in my OD Account, since, I am able to see a OD account where EMI is getting debit. It works like maxgain- where Available balance is increased whenever I deposit and Book balance is reduced with my deposited amount.How can I prepay or foreclose my loan.

    • Sumita Nath
      Sumita Nath
      Sep 28 2016 at 5:07 pm

      Hi Rani,

      You will have to intimate the bank to deduct your surplus amount from the outstanding principal amount for foreclosing your loan.

  7. Kumar
    Jul 25 2016 at 12:08 am

    I want to apply for a loan of 50 lakhs. I am confused between Max gain and normal loan from SBI. Can i make my Maxgain account as my salary account so that my salary gets credited to the same account. Will i end up benefitting something if i choose max gain over normal loan. Apart from EMI, i anticipate adding 2-3 lakhs every year to that account.

    • Sumita Nath
      Sumita Nath
      Sep 29 2016 at 5:38 pm


      You can go with max gain account for which you need to open salary account any which way. For those who see home loan re-payment as a pain each month, ‘Maxgain Home Loan’, offered by the State Bank of India is a convenient way to save and reduce your interest burden. Simply by clubbing your liquid finances with the home loan account, you can reduce interest burden substantially.

  8. Ganesh
    Jul 12 2016 at 6:01 pm

    I took home loan from SBI max gain for 24L 5 years back. Now I am planning to purchase a plot. If i apply for a topup loan on my current home loan, will the top up loan also gets max gain benefit? After my topup loan will i be able to get tax benefit for complete interest(basic home loan amount + top up loan amount) i pay?

    • Sumita Nath
      Sumita Nath
      Oct 05 2016 at 3:12 pm

      Hi Ganesh,

      Max gain benefits can be availed only on the home loan and top loan has a separate account. Also, you will get a tax advantage for a top up loan only if you use the loan amount exclusively for repair, renovation and construction activity of the home. Otherwise top up loans are loans with no tax sops, unlike a home loan.

  9. Tushar S Chaudhari
    Jun 04 2016 at 9:58 am


    I have a maxgain account with 9.55 interest rate. I have parked some amount in OD and that has resulted in interest saving of around 25000 so far. Does it may any sense to pay off this interest as prepayment. Does prepayment give any advantage in max main account than to park surplus amount in OD?


    • Tarini
      Jun 06 2016 at 5:23 pm

      Hey Tushar

      With respect to Maxgain account, parking the money in your OD account will give you the same benefits as prepaying the outstanding loan. Further, SBI has a restrictive prepayment policy when it comes to Maxgain:
      1. Borrowers are allowed to prepay only 2 – 3 times during the entire home loan tenure.
      2. Further, each prepayment must amount to minimum 20% of the current outstanding loan amount.
      I hope this information helps you make a decision 🙂

  10. nitin loomba
    May 26 2016 at 6:49 pm

    I took a home loan of 30 Lakhs & have paid around 10 lakhs . My current outstanding amount is 19.70 Lakhs and the loan is through IDBI @10%.
    I applied for a lona transfer to SBI @9.50% with a max gain facility , but as per them I cannot avail it as my loan amount is less then 20L .
    Also , I have an option to get my loan converted to a similar product available with IDBI bank called as interest saver , but ROI is 9.75 & I will have to pay .50% of the outstanding.
    Considering I can keep around 5-10L in my savings account , which option would you suggest?
    Nitin Loomba
    M 9891005896

    • Tarini
      Jun 03 2016 at 4:40 pm

      Hey Nitin

      Given that you cannot switch to SBI’s Maxgain home loan due to a lower outstanding amount here are a few options that I can suggest:
      1. Switch to a regular SBI home loan and use the surplus 5 – 10 lakhs to prepay your home loan. This will have the same impact as lowering the interest amount with a drawback of that money becoming inaccessible forever.

      2. You can switch to IDBI’s interest saver and park the surplus money in your OD account. Even though the interest rate is higher and you will have to pay a processing fees of .5% of the loan (= Rs. 9,850), you stand to save more here (compared to a regular SBI home loan) due to the benefits provided by an OD account. As, in an OD account you have the option to maintain as much liquidity as you can. Even if for a short period of time, it will help you save considerably on the interest payments, which will not be possible in a regular SBI account.

      I hope this helps you make a decision 🙂

  11. Prashant
    May 08 2016 at 8:13 pm

    Hi Tarini,

    Thanks for this awesome post. It’s really very helpful.

    I have booked an under construction flat worth Rs 62 lakh. The possession would be in Jun 2016. I am going to apply for SBI Max Gain home loan and planning to get 49 lakh (approx 80% of 62 lakh) approved. As per my mathematics, till final disbursement I will be taking only 44 lakh (remaining 5 lakh I will arrange myself).

    Question 1 – As per my understanding, at the time of possession, my max gain account should show 49 lakh as Limit and 44 lakhs as Drawing Power. Can I withdraw remaining 5 lakh anytime after possession since I will get transaction rights? In other way, will these 5 lakhs will be shown as Available Balance?

    Question 2 – Can I pay full EMI (interest + principal on disbursed amount) till final disbursement or can I pay only pre-EMI (interest)?

    Question 3 – are both options – fixed and floating interest rates available with Max Gain? If so which is more preferred?

    Thanks in advance,

    • Tarini
      Jun 28 2016 at 3:44 pm

      Hey Prashant

      Thank you for the appreciation, we are always happy to help 🙂 Regarding your queries, I think your are a bit confused about how Maxgain works. So let’s go over how it works, before moving on to your queries;
      1. In the case of under- construction properties the home loan is partially disbursed. So if you take a home loan of 49 lakhs, the entire value will be disbursed to the builder in parts, irrespective of your payment capabilities.
      answer to question 1: You will not be able to withdraw the 5 lakhs from your home loan. It will get directly disbursed to the builder by your bank. so if you are sure that you will be able to pay for the last installment yourself, I suggest that you take a home loan accordingly. Or you could take the full 49L and then use the 5L to make a partial prepayment once the loan has been fully disbursed.

      2. Any left over loan amount before complete disbursement will be limit minus drawing power and not the available balance. Available balance shows the balance of the amount deposited by you in the OD account.

      3. answer to question 2: Paying full EMI or pre-EMI is entirely up to you. while doing the documentation for the home loan, the bank will ask you to choose either of the options. I suggest that you weigh the pros and cons of both before making a decisions. Here’s a quick read on the same

      4. answer to question 3: Maxgain is available only on a floating interest rate. The latest interest rate for Maxgain on MCLR basis is 9.55% for men, and 9.50% for women borrower (primary).

      I hope this information has been helpful, do feel free to write in regarding any further queries.

  12. sasirekha
    Apr 30 2016 at 2:53 pm

    Hi Tarani,

    I have a clarification on MAX Gain as follows,
    Assuming My Loan Amount is 30lacs and i have parked 30Lacs in my OD account. now there will not be any benefit in extra deposits to my OD account.In this case can i Down size my Loan by paying 10Lacs towards my Loan 30Lacs…Please Clarify..

    • Tarini
      Jun 07 2016 at 8:24 pm

      Hey Sasirekha

      I apologize for the delayed response to your comment. Regarding your query; yes, in such a scenario, you can go ahead an prepay a part of your home loan. To prepay in Maxgain, you will have to make sure that the prepayment amount equals a minimum of 20% of the outstanding principal amount (as per SBI rules and regulations related to the product).

  13. Kranthi
    Feb 16 2016 at 3:58 pm

    Hi Tarini,

    Have recently taken constructed flat which is registered on my name on last month, now planning to take SBI Max gain home loan, Do we have a option for the taking home Loan.


    • Tarini
      Feb 17 2016 at 2:43 pm

      Hey Kranthi

      Since you have already made the purchase, you will not be eligible for any home loan, you can however apply for a mortgage loan. I hope this helps 🙂

  14. Naguleshwaran
    Jan 11 2016 at 8:26 pm

    Hello , I took Loan of 21,00,000 and choosed the Maxgain . I deposited the 3,000 so that i thought My interest will be calculated based on that and i can withdraw when i needed it . But i cannot see that 30,000 in the available balance and it shows as 0.

    The statement is not clear and our branch manager told once after my EMI taken i can see it back but strange is they did not take the EMI from my account this month even though i have sufficient balance .

    Do u have any idea ? and i can really say that even SBI branch managers dont have much idea on Max gain product

    • Tarini
      Jan 18 2016 at 1:43 pm

      Hey Naguleshwaran

      This is very strange. If you could send me an account statement at, then I may be able to help you out better.
      Further, do you see a difference of 30k between your drawing power and book balance? If yes, then you have nothing to worry about as the surplus money deposited by you is reducing the amount on which interest payable is calculated (the book balance). It may be a technical error in this case.
      Do let me know 🙂

  15. Vivek
    Jan 09 2016 at 11:34 pm

    Hi, I have “SBI Maxgain” housing loan with State Bank of Mysore (SBM). Though SBM says “SBI Maxgain” loan is same across all associate banks, I see lots of differences between SBM and SBI. There is no EMI concept in SBM – There is no option of pre-payment towards principal. They say that there is a standard monthly limit reduction, as given in the sanction letter – but I see that this also changes every month. Overall, things are not very clear with SBM – As per this blog, things should be very clear – I have also got a SBI’s maxgain loan statement from one of my colleague, which shows EMI transaction, and pre payment transaction, and things seem to be very clear, in SBI. Not sure, if “SBI Maxgain” product is same across all associate banks, why are these differences. SBM management viz., branch manager, SBM’s RACPC, and operations are not able to give clear answers about my above concerns. If you can clarify these, that would be great. In addition, I have these questions… Can I shift/transfer my housing loan from SBM to SBI? If yes, can I approach SBI’s RACPC directly? Secondly, I have SBI life policy associated with this housing loan. If I move to SBI, is it possible to associate SBI life policy account also to SBI loan account? Who does this? Will I have to approach SBI life for this?

    • Tarini
      Jan 27 2016 at 5:11 pm

      hey vivek

      Even though SBM is assiciated to SBI, there are several differences in the policies of both banks and the way their products are designed. So its quite possible that SBI MAxgain works differently in both banks.
      Moving on to your second query, yes you can go ahead and switch your home loan to SBI. You will just need to pay a processing fees and some registatrion charges to complete the process. You can go ahead and shift your Life Policy account too, to SBI along with the home loan for a minimal charge. There is no need to approach SBI Life for this. SBI will take care of it while switching your home loan.
      To switch your home loan, you will need to approach an SBI branch first and then it will get transferred and processed by the RACPC.
      I hope this helps 🙂

  16. Abhay
    Jan 06 2016 at 8:18 pm


    If the loan amount is partially disbursed for a underconstruction property. And, i started to pay full EMI even in underconstruction stages..

    In such case, it seems like my drawing power is not reduced as per schedule. Its remains same. What is the reason?

    • Tarini
      Jan 08 2016 at 2:35 pm

      Hey Abhay

      If you are paying full EMI then the drawing power will reduce in some amount with each EMI payment. Could it be that you can’t see the amount reduce as there have been a few subsequent disbursals too?

  17. Krishna
    Dec 11 2015 at 5:45 pm


    If the loan amount is partially disbursed for a underconstruction property. And, i started to pay full EMI even in underconstruction stages..

    In such case, it seems like my drawing power is not reduced as per schedule. Its remains same

    Im guessing, even though u pay full EMI monthly before full disbursement , the drawing power will not change…

    is that right?

    • Tarini
      Dec 14 2015 at 3:42 pm

      Hey Krishna

      If you are paying full EMI, then your drawing power will reduce, irrespective of whether its an under construction property or not. Please check the amortization schedule provided by the bank. Your drawing power should reduce in the same proportion as the principal component of the EMI mentioned. Please verify against the same.

  18. Murthy MVVS
    Dec 10 2015 at 7:38 pm


    I have an SBI Max gain account since more than 18 months. Presently I have parked an extra amount of Rs.80,000/- in my OD account. My SB account has Rs.2000/- only. The request to deduct my EMI (of Rs.20,000/- ) was submitted to be 5th of each month. The interest is debited to my account by the last day of the month. As I do not have sufficient amount in my SB account, do the bank automatically deduct from the extra amount that I had parked in the OD account or not? I observed that in the current month it has not deducted it – or is my observation wrong?
    Please note that recently I am receiving SMS alerts to pay my EMI or else some penal interest @2% is levied. Is the penal interest yearly or monthly.

    With thanks and regards,

    • Tarini
      Dec 25 2015 at 4:17 pm

      Hey Murthy

      Please pay your EMI immediately to avoid any penalty and negative impact on your Credit score! The additional penal interest is calculated on a monthly basis.
      SBI deducts EMI only from the SB account, it doesn’t deduct money from your OD account, this account can be operated only by you.

  19. Mrinmoy
    Nov 20 2015 at 2:09 pm

    How can I calculate Installment payment for a under-construction property?
    In above SBI Maxgain Amortization Schedule I am not able to proceed with installment payment and fixed interest rate.

    • Tarini
      Nov 23 2015 at 6:36 pm

      Hey Mrinmoy

      The amortizaion scheduler provided along with the blog post works with a floating interest rate only for a borrower making full EMI payments, unfortunately its not designed for a fixed interest rate home loan. Also, are you sure you are on a fixed interest rate in SBI Maxgain? Further, are you paying a pre – EMI or full EMI? If its a pre-EMI then it’ll be an easy calculation, you just need to calculate the amount of compound interest you need to pay on the total disbursed amount (this will have no principal component).

  20. sharathsysrath
    Nov 19 2015 at 9:44 pm

    Hi Tarini,
    Your post is very useful.
    I have a SBI regular home loan with my mother as co-applicant. The loan of 24 lakh was taken in Dec 2013 and I have already paid back 5.5 lakh as part of prepayment until Nov 2015.
    I am a software engineer by profession, I got to know about this SBI Maxgain account recently and I am realizing that this is the best option for me as I will be having some surplus amount every now and then.
    But, my loan manager did not respond properly, and gave a negative opinion about changing my regular home loan to SBI maxgain. Somehow, I feel I really want to switch this loan to such loan account with benefits of parking money.
    Can you suggest me, how can I defend with my Branch manager, is it possible to switch my regular home loan within SBI at all ? or is there any other option ?

    Your suggestion/feedback is highly appreciated , thanks in advance !

    • Tarini
      Nov 23 2015 at 7:17 pm

      Hey sharathsysrath

      I regret to inform you that its not possible to switch within SBI to the SBI Maxgain scheme due to a technical error in their internal system. There is no other way around this :/

  21. Nirav
    Nov 11 2015 at 1:20 pm


    I have HDFC home loan and now after 1.5 years planning to move from hdfc to sbi maxgain due to its benefit.

    But before starting any procedure i have following queries, can you help to resolve it??

    1. Any limit for no. of repayment in whole tenure?

    2. Any charges for repayment and what would be the maximum and minimum limit for repayment?

    3. If I am putting some amount in my OD account then as per maxgain benefit I will have saving on interest. but I have seen in multiple forums that having balance in OD will neither decrease your emi amount nor decrease your tenure. so what is the gain here and where that benefited saving amount gone??

    4. If I am freezing my balance by transferring balance from SBI saving a/c [OD] to max gain home loan account, than will it reduce my emi amount or my home loan tenure?


    • Tarini
      Dec 09 2015 at 3:22 pm

      Hey Nirav

      Here’s a clarification to all your queries :

      1. Yes, you can make only 2-3 repayments in the entire home loan tenure. The value of these repayments will need to be around 20% of the outstanding loan amount at the point of time. However, you can still get the benefits of repayment by parking your surplus money in the OD account. This will help reduce your book balance (the amount on which interest is calculated) in the same way as a prepayment would.

      2. No, there are no repayment charges/ prepayment charges in SBI Maxgain.

      3. Yes, it is true that the balance parked in your OD account will actually keep your EMI payments just the same, but it will also help reduce the interest that you pay on the entire loan. So essentially by parking money in your OD account, you can close your home loan sooner than the actual loan tenure and the constant EMI payments will cover for the decrease in interest payments – helping you close sooner. I hope this clears the confusion.

      4. I am not sure about the usage of the term – “freezing my balance by transferring balance from SBI saving a/c [OD] to max gain home loan account”. Could you please elaborate? It will help me answer your query better. Thanks 🙂

  22. Dev
    Oct 24 2015 at 9:51 pm

    Dear Sir,

    I have applied for home loan of 40Lac from SBI , they suggest me SBI Max Gain, I could not able to understand the benefit of the same, I have already made 2 payment from my saving for the under construction flat and will try to make another 2 instalment from my savings, which means i may be using 30 lac only from loan amount, can you explain me what is a benefit of SBI Max gain.

    Also SBI asked me to take life insurance for 40Lac for 20yrs which is costing me around 1.14Lac and it is non-non-refundable, can you suggest me any other best insurance at low cost or on refundable pls.

    • Tarini
      Oct 26 2015 at 12:17 pm

      Hey Dev

      The benefit of SBI Maxgain is that it comes with an over draft (OD) account. This account helps you save on your EMI payments, this is how it works:
      In Maxgain you will see the following accounts-
      book balance: This is the amount on which you pay the interest on. Its calculated as – drawing power minus available balance.
      drawing power: This amount is the total loan amount that has been disbursed to you.
      limit: This is always equal to the drawing power.
      available balance: This reflects the amount of balance you maintain in your OD account.

      So by parking all your surplus money in the OD account (even if for a short duration), you can save substantially on your interest payments. Do note that the interest rate for Maxgain has been increased to 9.80 for general borrowers, with a reduction of .5% for women borrowers.

      Regarding the life insurance, its best to take an insurance that covers all your EMI payments in case of any unfortunate incident. although its compulsory to take an insurance while taking a home loan from SBI, you don’t need to take one from SBI itself, you can explore other options too.

      About the reduced loan amount, you can ask SBI to disburse only 30 lakhs, that should not be a problem 🙂 I hope this helps!

  23. Anand Sisupalan
    Oct 14 2015 at 5:40 pm

    Me and wife have around 22 years back availed a loan which was paid off in ten years. Then I had availed another loan in 2005 which was sjhortclosed. Both with HDFC. Now I am trying to avail another loan from SBI for a property jointly owned by may daughter, wife and me. But SBI says max gain they can’t give as through principal borrower is my daughter (who had never availed loans) as me and wife are coapplicants and so max gain cannot eb availed. only normal loan. So I had to give consent for the same. Is this right? Is there a way out to avail the maxgain loan

    • Tarini
      Oct 14 2015 at 7:36 pm

      Hey Anand

      The reason given by bank is very unusual as you don’t need to an existing borrower to apply for Maxgain. Its quite possible that the banks may have refused to give you a loan as they refrain from lending to blood related co-borrowers. I’d advise you to approach another branch of SBI, you may have better luck there.

  24. Nagesh
    Oct 13 2015 at 12:48 pm

    Hello Sir,

    I am planning to go for Max Gain next month for Composite Loan (Plot + Construction) for 45 Lakhs in this regard i wanted to know will I be eligible for Income Tax Exemption for the repayment made towards the loan and to what extent ? A detailed explanation will be of great help please.

    • Tarini
      Oct 13 2015 at 1:55 pm

      Hey Nagesh

      You can claim tax benefits on the all EMI payments once you have taken possession of your property. After possession, you can claim tax benefits in 5 equal installments over the next 5 years, only if the construction is completed with 3 years of taking the loan. If the construction phase exceeds this time frame, then you will able to claim tax benefits on payments made during this period only up to a limit of Rs. 30,000. I hope this helps 🙂