Home loans will get expensive as HDFC raises retail prime rate by 25 basis points
The new rate will come into effect on August 9. The benchmark lending rate for home loans was raised by 25 basis points, the mortgage lender said in a regulatory filing. “HDFC is increasing its retail prime rate (RPLR) on home loans, on which its adjustable rate home loans (ARHL) are benchmarked, by 25 basis points, effective August 9, 2022,” it said. -he declares.
The latest announcement from the country’s largest housing finance company comes nearly a week after it raised the RPLR by 25 basis points, effective August 1. The policy rate has been raised six times since May this year, the cumulative increase totaling 140 basis points. .
What does an RPLR hike mean?
The Retail Prime Lending Rate is the rate at which housing finance companies lend to their most creditworthy customers. When lenders make their loans to customers, the RPLR is considered the benchmark against these rates. The increase in RPLR will lead to an increase in EMIs paid by home loan borrowers.
HDFC Bank raises rates by up to 10 basis points across all loan terms
ICICI Bank and PNB raise benchmark external lending rates
Meanwhile, the mortgage lender also earlier on Monday announced an increase in the marginal cost of funds-based lending rate (MCLR) across all loan terms by 5 to 10 basis points, “effective August 8, 2022. “.
The increase should come as no surprise as financial institutions are expected to raise lending rates as the central bank has raised the repo rate since May in a bid to keep inflation under control. The last repo rate hike by the RBI was on August 5, when it announced a 50 basis point jump in the key rate.
Hikes in the repo rate over the past three months have taken it to 5.4%, the highest since August 2019.