HDFC slashes lending rate by 0.25 per cent

New Delhi: HDFC, country's largest mortgage lender, cut benchmark lending rate on housing loans b 0.25 per cent to 9.65 per cent, a move which will lower the EMI for borrowers. The effective home loan rate for new customers would be 9.65 per cent, while for women borrowers, it would be 9.60 per cent, HDFC said in a statement. The existing rate for new customers is 9.9 per cent, whereas for women, it is 9.85 per cent. This reduction, effective tomorrow, would benefit all customers, it added.

The reduction in the Retail Prime Lending Rate (RPLR) will also be applicable on loans to Non-Resident Indians (NRIs)/ PIO card holders, the statement said. HDFC had recently made similar reduction in its deposit rates across all maturities. Following the easing of monetary policy by RBI, country's largest lender SBI reduced its base rate or minimum lending rate by 0.40 per cent, setting-off a series of rate cut announcements. Later, it transpired that SBI hiked its spreads on home loans by 0.20 per cent in order to protect its margins.

SBI's standard offering to non-female applicants currently stands at 9.55 per cent, while HDFC offers the same at 9.90 per cent. The rate cut has been triggered by the Reserve Bank revising downward its benchmark short-term lending (repo) rate by 0.50 per cent in its fourth bi-monthly monetary policy review. Following this, about 20 banks from public and private sectors have cut interest rates by up to 0.40 per cent. Market majors like ICICI Bank, Punjab National Bank, Bank of Baroda, among others, have already cut rates.