HDFC raises home loan rates by 25 bps from Monday

The country’s largest housing finance company, HDFC, has increased its retail prime lending rate on home loans by 25 basis points (bps) from August 1, 2022.

This is the fifth rate raise by the corporation in two months. The lender has increased its benchmark rates by 115 bps (100 bps = 1%) this year.

Following this increase, the best home loans from HDFC will be available at 7.8%, the highest in two years but still lower than the pre-pandemic level.

Before this, the best rates were 7.55%. With this increase, the EMI on a Rs 1 crore home loan with a 20-year tenure will go up from Rs 80,865 to Rs 82,404.

HDFC rate uptick comes ahead of the RBI monetary policy committee (MPC) meeting on August 5.

The central bank is widely expected to increase rates by 35-50 bps to combat inflation and to keep up with the US Federal Reserve

which has been on a rate uptick spree, which has put pressure on the rupee.

Most banks are expected to follow suit in August.

Many public sector banks have said their asset-liability management committee will decide after the MPC decision.