Housing Development Finance Corp (HDFC) is known as India’s largest mortgage financier. The bank has recently hiked its housing loan interest rates after 2013. The HDFC has set the new benchmark for prime lending rate (PLR). It has lastly set the PLR in December 2013.
HDFC Bank Increased Home Loan Interest Rates
Home loan rates for credits above Rs 30 lakhs have been raised by up to 20 premise points while those below Rs 30 lakhs, which incorporate need sector loans, have been increased by 5 premise points, HDFC said in an announcement. One premise point is 0.01 rate point.
The benchmark PLR for HDFC had descended from its peak of 16.75% in December 2013 to 16.15% preceding this increase. It will now go up to 16.35%. The increments are compelling from April 1. This increase reflects the increase in our cost of assets since October. Between July 2017 and now, ten-year government security yields have risen 100 premise points. In spite of the fact that yields have descended since February-March, they are still high.
“This hike in PLR will help us maintain our margins in the 2.20% to 2.35% range, which has been our historic average for more than ten years,” HDFC CEO Keki Mistry said.
The cost of loans between Rs 30 lakhs and Rs 75 lakhs has been raised to 8.60% from 8.40%. Credits above Rs 75 lakh will cost 8.70%, up from 8.50%. Credits up to Rs 30 lakhs would now cost 8.45%, up from 8.40%. Ladies loans will get a five-premise point refund for all the above slabs.
One year marginal cost of funds based lending rate offered by HDFC now stands at 8.10%.
The six month rate offered by HDFC stands at 7.90%.
The new rate of interest are effective from 7th November.