Home loan borrowers of HDFC Bank may see a reduction in their EMIs as the bank has reduced floating home loan rates by 50 basis points.
Not only will the existing borrowers avail this benefit but also the new borrowers of up to Rs 20 lakh will get a reduced interest rate by as much as 150 basis points. On the other hand, existing borrowers with loans up to Rs 20 lakh and new as well as old borrowers of loans above Rs 20 lakh will be charged 50 basis points lower than the old rates.
The reduced interest rate will translate an individual's EMI by a only nominal amount. For a loan of Rs 20 lakh with 20 years of repayment period, EMI would come down by Rs 680. Similarly EMI for loans with same amount and tenure of 15 years and 10 years will be reduced by Rs 660 and Rs 600 respectively.
The move is likely to benefit about 90% of the bank's retail customers which count to nearly 9 lakh borrowers. The bank official suggest that prospective buyers should opt for a floating rate home loan as there are expectations of further dip in the rates. MD and VC of HDFC, Keki Mistry said, "Earlier this week, we raised medium-term funds at an annualised rate of 9.5-9.6%. If there is a further reduction in the cost of funds, we will pass that on to our borrowers." Fixed rate home loan of the bank stand unchanged at the original position.
The high value loans of the bank that are termed to be above Rs 20 lakh will be offered at 11.25% against 10.25% rate charged for loans below Rs 20 lakh.