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HDFC, SBI hike home loan rates, others to follow suit
Home loan borrower, get ready to pay more. After HDFC hiked home loan rate late on Wednesday by 50 basis points across all maturities, including floating rates, market leader ICICI Bank said that they were watching the situation as the cost of funds was rising.
Home loan borrower, get ready to pay more. After HDFC hiked home loan rate late on Wednesday by 50 basis points across all maturities, including floating rates, market leader ICICI Bank said that they were watching the situation as the cost of funds was rising.
A senior ICICI Bank functionary said, “We are not saying that we will not increase the rate, but it is not imminent. Sometime early next week, we will take a call on the matter depending on the impact of the cost of funds.”
HDFC hiked its prime lending rate from 10.75 per cent to 11.25 per cent. This follows a similar upward revision in both fixed and floating home loans, a HDFC spokesperson said.
While fixed rate has been changed from 8.75 per cent to 9.25 per cent, the floating rate has been changed from 7.50 per cent to 8 per cent. The interest rates on a Rs 10-lakh plus loan for a tenure of 15 years will go up from 7.5 per cent to 8 per cent in the case of floating rate and from 8.75 per cent to 9.25 per cent for fixed rates. “The new rates will be applicable for fresh loans. Rates for old floating loans will also rise,” said an HDFC official.
The upward revision was necessitated because of a hike in deposit rates by 25 to 50 basis points.
Immediately after the HDFC hike, the State Bank of India too reportedly hiked its home loans by a similar 50 basis points.
With the increase of repo and reverse repo rates by 25 basis points by the Reserve Bank of India in its third-quarter review of the monetary policy, banks are all now poised to increase retail lending rates.
