HDFC Ltd, the biggest player in the home loan segment, on Monday reduced interest rate on floating loans by 0.50 per cent.
The change comes into effect from Monday, a HDFC spokesperson told PTI in Mumbai.
This reduction will be on fresh loans and applicable to all disbursements up to October 31.
However, there is no change in the fixed home loans rate, which remains at 13.25 per cent.
The rate cut comes after HDFC Chairman Deepak Parekh said on September 21 the funding costs have come down.
Parekh had said he expected loan growth in the second quarter of this fiscal at 26-27 per cent for HDFC and 20-25 per cent for the whole fiscal.
"Property prices have softened, sales have slowed down and the investor is out of the system," he had said.