DHFL offers home loan at 8% interest rate

DHFL offers home loan at 8% interest rate

Mumbai: Dewan Housing Finance Corporation Ltd (DHFL) has joined the bandwagon of those offering lower interest rate home-loan schemes for the lower and middle income (LMI) group.

The company on Monday announced a 25-year home-loan scheme at a fixed 8% interest rate annually for a period of two years for loans upto Rs5 lakh, thereafter reverting to the variable interest rate. Similarly, the company has fixed an interest rate of 8.75% annnually for two years for loans above Rs20 lakh.

DHFL will offer customers the dual advantage of lowest interest rate and an elongated period of repayment.

A slew of banks including State Bank of India, ICICI Bank, Dena Bank and home-loan provider, HDFC, among others, have lowered their home-loan interest rates in recent days, intensifying competition in the segment.

“DHFL Easy Easy Loan scheme’ has been designed to help reduce the interest rate burden on the borrower and the elongated period will help reduce the amount of EMI over the tenure. The scheme offers the lowest EMI of Rs772 per lakh," DHFL’s chairman and managing director, Kapil Wadhawan, told reporters here.

“We are empowering the common man by providing the same eligible amount of loan at a lower interest rate, reducing the monthly installments by a considerable amount through an extended period of 25-years, Wadhawan said.

The scheme will be offered to home-buyers across India and NRI customers in the Middle-East and the UK. It will be available across all branches and service locations of DHFL in India and abroad and will be valid for all applicants till 31 January, 2010, with a partial disbursement before March 2010.

The customer can avail loans from a minimum value of Rs1 lakh to a maximum amount of Rs5-crore.

DHFL is expecting incremental disbursement of Rs3,500 crore by the end of current fiscal through this scheme, DHFL’s chief executive officer (CEO), Anil Sachidanand, said.

It is expanding its business through retail franchisee and tie-ups with public sector banks.

“We will expand our business through two options, namely, retail franchisee and tie-ups with public sector banks. We have joined hands with Punjab and Sind Bank for north and entered into final negotiations with United Bank of India for expansion in the eastern part of India," Sachidanand said.

These banks would provide office-space and DHFL would originate loans, he said. During the last 25-years of operations, DHFL has been a pioneer in the housing finance industry with a focus to provide financial access to the lower and the middle income (LMI) segment in the rural and semi-urban areas of the country and has serviced over 2,50,000 households over the period.