Home / Money / Personal Finance /  LIC Housing Finance hikes prime lending rate by 50 bps, EMIs to go up. Check rates here

LIC Housing Finance has hiked its prime lending rate by 50 basis points with effect from Monday onward. The hike in the lending rate is in line with RBI's repo rate hike of 50 basis points in the August 2022 policy. That said, EMIs on home loans linked to the prime lending rate is likely to go up ahead. However, the HFC expects demand for housing to remain robust despite RBI's rate hike.

As per the update on the website, LIC Housing Prime Lending Rate (LHPLR) is now at 15.80% effective from August 22, 2022.

On the lending rate hike, LIC Housing Finance's Managing Director & Chief Executive Officer, Y Viswanatha Gowd said, "As expected, the RBI's decision to hike the repo rate by 50 basis points on 5th August was well measured and abreast with the global economic trend. The hike in repo rate has caused some minimum fluctuation in the EMIs or the tenure on the home loans but demand for housing will remain robust. Hence, the interest rate hike of LIC HFL is in line with the market scenario," as reported by ANI.

The new interest rates on LIC Housing's home loans will now start from 8% from the previous 7.50%.

According to the website, LIC Housing has imposed an 8.05% interest rate on home loans up to 50 lakh, and 8.25% on more than 50 lakhs to 2 crore for salaried and professionals who have a CIBIL score of greater or equal to 700, are eligible for these rates.

For credit scores between 600-699, the interest rate is 8.30% on home loans up to 50 lakh and 8.50% on over 50 lakh to 2 crore. The rate is 8.75% (up to 50 lakh home loan) and 8.95% (more than 50 lakh to 2 crore) for CIBIL scores less than 600. While the rate is 8.70% (up to 50 lakh loan) and 8.90% (more than 50 lakh to 1 crore) on CIBIL score 101-200 OR NTC.

However, LIC Housing is offering an 8% interest rate on home loans greater or equal to 10 lakh with a CIBIL score of equal to or greater than 700.

In the last three policies, RBI has hiked the repo rate by 140 basis points. The first hike was 40 basis points in May, followed by 50 basis points in June, and another 50 basis points increase in August.

Now, the policy repo rate under the liquidity adjustment facility (LAF) is at 5.40%. Consequently, the standing deposit facility (SDF) rate stands adjusted to 5.15%, and the marginal standing facility (MSF) rate and the Bank Rate to 5.65%.

Also, the MPC decided to remain focused on the withdrawal of accommodation to ensure that inflation remains within the target going forward while supporting growth.

RBI's rate hike pattern is to tame multi-year high inflation. CPI inflation has stayed above RBI's inflation target for the seventh consecutive month at 6.72% in July. RBI's medium-term target for inflation is 4% within a band of +/- 2%.

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