Up to 5 years, HDFC fixed-rate loan now costs 9%, 6-10 years 9.25% and above 10 and up to 20 years 9.75%
Housing Development Finance Corporation (HDFC) today cut its prime lending rate (PLR) for home loans by 25 basis points (one basis point is one hundredth of a percentage point).
This essentially means all floating rate loans of HDFC will cost 25 basis points less now.
Also Read
Canara Bank too cut its floating home loan rates by an identical margin today. In the first week of July, HDFC had cut its home loan rates for fixed-rate loans by 25 basis points across maturities.
This brought the fixed rate loan and floating rate loans on a par. In other words, there was no rate differential between the two products.
By cutting the PLR by 25 basis points, HDFC now brought down the interest rates on floating rate loans lower than the fixed rate loan.
Up to five years, fixed-rate loan now costs 9 per cent, six to 10 years 9.25 per cent and above 10 and up to 20 years 9.75 per cent. The floating rate loans will be 25 basis points lower than this.
Now floating rate loans of Canara Bank will now cost 7.75 per cent of loans up to five years, 8.75 per cent for loans above five years but up to Rs 10 lakh and 9 per cent for loans above five years and beyond Rs 10 lakh.
Fixed rate loans will cost 8.25 per cent, 9.5 per cent and 9.75 per cent, respectively, for the three categories.
Industry sources said there is nothing sacrosanct about the floating rate loans as they can always be beaten down.