LIC Housing Finance has reduced its rates of interest for individual home loan borrowers and will charge 7.5 per cent for new customers having a CIBIL score of 800 or more for any amount of loan. Earlier these individual home loan borrowers were charged a rate of interest of 8.10 per cent for any amount of loan.
The mortgage lender said an additional reduction of 10 bps will be offered i.e. interest rate of 7.40 per cent if the borrower assigns a new or existing single premium term assurance policy with the sum assured equal to the loan amount to LIC Housing Finance. The rate of interest will be linked to the creditworthiness as reflected in CIBIL scores of the borrowers. This rate reduction will be effective immediately, the lender notified.
Siddhartha Mohanty, MD and CEO of LIC Housing Finance Ltd, said, “The present crisis has forced businesses to adapt to factors like social distancing and prepare for a new normal by leveraging technology. Additionally, LICHFL’s home loan app HomY has equipped our marketing teams to onboard customers digitally and provide faster turn-around time in loan approvals as well as servicing without visiting our offices. We want to bring confidence back to the sector and will do our part in supporting the real estate industry and the economy.”
HDFC, India’s largest mortgage lender, also reduced its home loan rate by 15 bps a few days back. The development came in line with similar steps taken by the State Bank of India (SBI), which slashed its lending rate to pass on the RBIs rate cut benefits to borrowers. The Reserve Bank of India, on March 27 in its 7th bi-monthly monetary policy statement, announced a 75 bps cut in the repo rate along with a 90 bps reduction in the reverse repo rate. The announcement was to offset the impact of the coronavirus pandemic on the economy.