HDFC cuts PLR by 5bps, home loans now at 6.75%

MUMBAI: The country’s largest housing finance company HDFC has cut interest rate on its home loans to 6.75% from 6.8%. HDFC has cut its retail prime lending rate (PLR) by 5 basis points (100bps = 1 percentage point), which will bring down interest rates for existing borrowers too.
While State Bank of India’s (SBI’s) best rate is 5bps lower than HDFC, there are some categories where the latter matches SBI, as the private lender’s new rates are applicable for loans irrespective of the amount.
Speaking to TOI, HDFC MD Renu Sud Karnad said this was the best time for homebuyers as besides rates being at an all-time low, many state authorities have reduced stamp duties and reduced circle rates, which have an impact on stamp duty calculations. “Builders are willing to negotiate prices when they are approached by buyers. With demand picking up, my call to builders is that confidence is still to come in and they should refrain from trying to increase rates,” she said.
According to Karnad, HDFC has the best turnaround time in the industry and it is getting better due to use of technology. “We are able to process applications of even self-employed applicants within a couple of days.” She said the corporation was an early adopter of video KYC and straight-through processing of applications.
“While companies may give some employees, like new mothers, the option of working from home, sitting together in office is essential for developing a corporate culture, ideating and meeting people,” said Karnad. She said that while the pandemic has resulted in many homebuyers looking for an additional room, the demand for office space would not go away.
According to a survey conducted by Anarock Property Consultants, women are turning out to be key homebuyers with 62% of them seeing it as a preferred investment asset class as against 54% men. The security of physical assets influences 31% of women homebuyers, while 28% are attracted by cheaper home loans and 22% by offers and discounts.