HDFC Hikes Lending Rates by 50 bps from Today; How Much Home Loans; EMIs to Increase

The Housing Development Finance Corporation or HDFC raised lending rates by 50 basis points per day after the Reserve Bank of India (RBI) raised its repo rate. To tame rising inflation, the Reserve Bank of India raised the repo rate by 50 basis points to 4.9 per cent in its June monetary policy. Earlier in May, the central bank raised the repo rate by 40 basis points in an out-of-cycle move.

The mortgage bank said in a regulatory filing that the new lending rate will take effect from June 10. “HDFC increases the prime rate lending rate (RPLR) on housing loans, at which adjustable rate home loans (ARHL) are measured, by 50 basis points, effective June 10, 2022,” the statement said.

HDFC Home Loan interest rates, effective June 10, 2022

The basic lending rate to individuals is the rate at which housing finance companies provide loans to their most creditworthy customers. Customers will get home loans with cheaper interest rates, if they maintain a good credit score.

To get a home loan of up to Rs 30,000, the borrowers have to pay an interest rate of 7.65 per cent to 8.15 per cent. For others, the interest rate will be between 7.7 percent to 8.2 percent.

For a home loan of more than Rs 30,000 to Rs 75,000, the rate of interest will be between 7.9 per cent to 8.4 per cent for the female borrowers. For others, the interest rate will range from 7.95 percent to 8.45 percent for the same amount.

For housing loans above Rs 75,000, the rate of interest will be between 8 per cent to 8.5 per cent for the borrowers. For others, the rate of interest at Rs 75,000 and above will be between 8.05 per cent to 8.55 per cent.

The lender raised the prime rate lending to individuals (RPLR) on housing loans by 5 basis points on June 1.

Explaining the rate hike, Pranjal Kamra, CEO of Finology Ventures explained, “Raising the interest rate means increasing the cost of funds for banks and financial institutions. In return, the banks will pass this cost on to the borrowers by increasing the lending rate. Therefore, the amount of EMI is For borrowers all floating rate retail loans such as home loans, auto loans and gold loans will increase.”

ICICI Bank, raises lending rates from PNB

ICICI Bank also earlier raised lending rates by 50 basis points. “The ICICI External Standard Lending Rate (I-EBLR) is referenced to the RBI policy repurchase rate in excess of the repo rate,” the lender said on its website. ICICI said that as of June 8, the I-EBLR is 8.60 percent of Papm as of June 8, 2022.

The Punjab National Bank (PNB) has also raised the repurchase-linked lending rate (RLLR) with effect from June 9, 2022. For existing and new borrowers, the lending rate has been changed from 6.9 percent to 7.4 percent. “RLLR changed from 6.90% to 7.40% {Repo Rate (4.90%) + Mark-up (2.50%)} wef 09-06-2022 for existing and new customers. Together with RLLR BSP of 25 bits per second.” said the bank.

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