Wednesday, March 25, 2009

HDFC cuts floating interest rates on home loans

Now, Up to Rs30 lakh - 9.5%

More than Rs30 lakh - 10.5%

Fixed rate loans 14.25%

Retail Prime Lending Rate (RPLR):

India’s largest mortgage lender Housing and Development Finance Corp. Ltd (HDFC) on Tuesday lowered its retail prime lending rate (RPLR) by half a percentage point to 14%.

Floating Interest Rates:

This will affect all its home loans taken on floating interest rates. Benefits from the rate cut will be passed to existing floating rate customers in the next three months, based on reset dates, HDFC said in a statement.

Benefit to existing customers:

The rate cut comes after State Bank of India and ICICI Bank Ltd, the country’s two largest lenders by assets, revised interest rates earlier in March. They, however, did not reduce their RPLRs that would have benefited existing floating rate customers.
To read more, please, visit - Anita Bhoir - livemint.com

Is this going to stop you from 'switching bank'?

True, just because another bank is offering lower rates, it may not make sense to switch. Still, we all know that SBI's low interest rates are threat to HDFC.

Making it expensive for those home borrowers who are choosing to switch or by playing to the gallery by preaching to the builders to reduce the property rates and now cut in floating interest rates for existing customers is not a solution to prevent you from switching. If HDFC wants your business, they must reduce the interest rates and compete with PSU banks. Isn't it? Please, share your views in the comments. Comments Policy

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