Indiabulls Housing Finance on Monday announced an increase of 20 basis points in interest rates for home loans. After the revision, the interest rates on home loans worth up to Rs 35 lakh will start at 8.7 per cent, Indiabulls Housing Finance said in a statement. The move on home loan interest rates by the housing finance company comes days after the Reserve Bank of India (RBI) announced a 25-basis-point hike in repo rate, the key rate at which it lends short-term money to commercial banks, to 6.5 per cent. A higher repo rate makes it more expensive for lenders to borrow funds from the central bank.
Here are five things to know about Indiabulls Housing Finance's move on its home loan interest rates:
1. The revised interest rates on home loans will be applicable to new and existing customers, Indiabulls Housing Finance said.
2. Indiabulls Housing Finance said the increase in lending rates - or interest rates on home loans - comes "with the growing cost of funds led by the consecutive raise on repo rate by the RBI.
3. While the interest rate on new home loans for women applicants/co-applicants will now start at 8.7 per cent in case of loans of up to Rs 35 lakh, the starting interest rate on loans worth more than Rs 35 lakh will be 8.8 per cent, according to Indiabulls Housing Finance. For non-women applicants, the interest rates would be 5 basis points higher, it noted.
4. The company also expanded the lowest slab of home loans to Rs 35 lakh from Rs 30 lakh. That, the company said, will allow "a larger pool to reap the benefits of the best possible rate".
5. Indiabulls Housing Finance also said it will communicate the increase in home loan interest rates to existing borrowers by way of SMS and email.
Indiabulls Housing Finance shares closed 0.5 per cent lower at Rs 1,370.70 apiece on the NSE, ahead of its announcement on home loan interest rates, as against a 0.5 per cent rise in the bourse's secrotal index comprising financial services stocks.