Mumbai: Housing Development Finance Corp Ltd (HDFC), India’s oldest mortgage Company, on Tuesday raised its retail prime lending rate, the benchmark rate for its home loans, by 50 basis points (bps) to 16.50%, effective 1 August. One bps is a hundredth of a percentage point.
This is the stiffest benchmark rate in HDFC’s history.
Following this, floating rate interest on loans up to Rs 30 lakh will be 10.75%, while loans above Rs 30 lakh but below Rs 75 lakh will carry 11% interest. Floating rate for loans more than Rs75 lakh will be 11.50%.
Its fixed rate loan, last raised in May, remained unchanged at 12.5%.
"This is in line with interest rates in the economy, which have hardened due to increase in policy rates by 75 bps since June 2011,” the firm said in a statement after the market hours.
The hike by HDFC is in line with similar moves by other lenders. Most banks have hiked their loan rates by 25 to 50 bps after the Reserve Bank of India (RBI) raised its policy rate by 50 bps it July, its 11th rate hike since March 2010, to rein in a persistently high inflation in the world’s tenth largest economy.