News APP

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  gplay

This article was first published 2 years ago
Home  » Business » HDFC hikes home loan rate; PNB ups MCLR

HDFC hikes home loan rate; PNB ups MCLR

Source: PTI
June 01, 2022 23:21 IST
Get Rediff News in your Inbox:

Mortgage lender HDFC Ltd on Wednesday announced an increase in its benchmark lending rate by 5 basis points (bps), a move that will make loans dearer for both existing and new borrowers.

Home loan

Illustration: Uttam Ghosh/Rediff.com

This is the third hike effected by HDFC in the last one month.

"HDFC increases its Retail Prime Lending Rate (RPLR) on housing loans, on which its Adjustable Rate Home Loans (ARHL) are benchmarked, by 5 basis points, with effect from June 1, 2022," the housing finance company said in a statement.

 

The revised rates for new borrowers range between 7.05 per cent and 7.50 per cent, depending on credit score and loan amount.

The existing range is 7 per cent to 7.45 per cent.

For existing customers, the rates would rise by 5 basis points or (0.05 per cent).

Last month, HDFC had increased its benchmark lending rate by 35 basis points making EMI for existing borrowers expensive.

HDFC follows a three-month cycle for repricing its loans to existing customers.

So the loans will be revised in sync with increased lending rate based on the date of the first disbursement of each customer.

Financial institutions are on an interest rate hike spree following an increase in the repo rate and cash reserve ratio (percentage of total deposit of the banks kept with RBI) by 40 basis points and 50 basis points respectively announced by the RBI last month.

After an out-of-turn Monetary Policy Committee (MPC) meeting, the Reserve Bank last month hiked the benchmark repo rate -- the short-term lending rate it charges to banks -- by 0.40 per cent to 4.40 per cent in order to tame soaring inflation.

State-owned Punjab National Bank (PNB) raised its marginal cost of funds-based lending rate by 15 basis points or 0.15 per cent across all tenures, a move that will lead to an increase in EMIs for borrowers.

The new rates are effective from June 1, PNB said in a regulatory filing.

The revision follows an off-cycle rate increase by the Reserve Bank in May.

The central bank hiked the repo rate -- at which it lends short-term money to banks -- by 0.40 per cent to 4.40 per cent.

With the revision, one-year MCLR has increased to 7.40 per cent from 7.25 per cent earlier.

Most of the loans are linked to the one-year MCLR rate.

The overnight, one-month and three-month MCLR rose by 15 basis points to 6.75 per cent, 6.80 per cent and 6.90 per cent, respectively, whereas the six-month MCLR increased to 7.10 per cent.

At the same time, three-year MCLR increased by 0.15 per cent to 7.70 per cent.

With the increase, EMIs will go up for those borrowers who have availed loans on MCLR (Marginal Cost of Funds based Lending Rate).

Get Rediff News in your Inbox:
Source: PTI© Copyright 2024 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.
 

Moneywiz Live!