Private sector lenders ICICI Bank and Axis Bank on Tuesday reduced home loan rates by up to 0.25%. ICICI Bank has cut interest rates on home loans by 25 basis points (bps) to 9.85% for women borrowers and applicants from weaker sections and to 9.9% for other borrowers, the bank said in a statement on Tuesday.
Axis Bank has trimmed interest rate on its floating home loan by 20 basis points to 9.95%, according to a press release that added the new floating rate has been made available with effect from April 13. The bank said it has introduced a single slab applicable for all salaried customers irrespective of the loan amount. Axis bank also said it has reduced its interest rate on Asha home loans by 30 bps.
This reduction brings ICICI Bank, SBI and HDFC on par in home loan rates at 9.9%. ICICI Bank had last revised its home loan rates in May last year when it reduced home loan rates for salaried and women borrowers by 10 to 15 bps.
The interest rate for fixed rate home loans have also been reduced, the bank said, adding that borrowers taking fixed rate home loans with a tenure of 10 years for loan amount of up to R30 lakh will have to pay 9.9%, the same effective interest rate applicable for floating rate home loans.
ICICI Bank’s home loan portfolio on December 31, 2014, stood at R84,425 crore, up 26.76% from R66,599 crore a year earlier.
This follows a 25 bps reduction in base rate to 9.75% earlier last week. After the RBI urged banks for transmission of policy rates last week, State Bank of India (SBI), HDFC Bank, ICICI Bank and Axis Bank lowered base rates by 15-25 bps to 9.75-9.95%.
At present, base rate — lowest lending rate — of all banks stand in the range of 9.75-11%. The base rate of ICICI Bank is at 9.75%; SBI and HDFC Bank are at 9.85%; Axis Bank is at 9.95% and United Bank and Union Bank stand at 10%. For lenders like IDBI Bank and Punjab National Bank (PNB), it is at 10.25% and for Federal Bank, the base rate stands at 10.2%.
DHFL, Indiabulls lower home loan rates to 9.9%
Housing finance firms Dewan Housing Finance (DHFL) and Indiabulls Housing Finance (IBHFL) lowered home loan rates by 25 basis points (bps) and 20 bps, respectively, to 9.9%, the lenders said in separate statements on Tuesday. In case of DHFL, the rate has been revised downward from 10.15% and the new rate would be effective from Wednesday. “The reduction in the interest rate reflects our commitment towards enabling home ownership in tier 2 and 3 towns for each and every Indian,” said Kapil Wadhawan, CMD of DHFL. Gagan Banga, vice-chairman & MD, IBHFL, said, “As a leading HFC passing this benefit to our customers is a commitment to our long-term relationship with them, and we hope that these benefits bring them closer to owning a home.”