HDFC raises home loan interest rate by 50 bps

Lending major Housing Development Finance Corporation (HDFC) has increased its Retail Prime Lending Rate (RPLR) on housing loans -- on which its Adjustable Rate Home Loans (ARHL) are benchmarked -- by 50 basis points.

The new rate will come into effect from June 10, it said on Thursday.

Effectively, now home loan rates of the lender would start from 7.55 per cent.

The rate revision by the lender comes a day after the Reserve Bank of India raised the key lending rates or repo rate by 50 basis points to tame high inflation, which essentially meant the cost of borrowings were going to rise. Repo rate is the rate at which the central bank RBI lends short-term funds to banks.

Going ahead, many other banks and non-banking financial companies are expected to follow suit on the interest rate hike.