With RBI hiking the repo rate, home loans under the floating rate regime have witnessed a hike of .75 %. Leading housing finance providers like HDFC and ICICI Bank have again raised the interest rates. Who spares a thought for the loanee?.

HOME LOANS have again become dearer, no thanks to the hike in interest rate (repo rate) effected by the Reserve Bank of India (RBI) when it released the first quarter review of its Annual Policy Statement, 2008-09. Just over a month ago, HDFC and ICICI Bank raised the interest rate on home loans. They have done it again in respect of housing loans provided under the floating rate regime.

HDFC, the country’s largest home loan provider has hiked the interest rate applicable to the home loans provided under the floating rate regime by .75%. Fortunately, on those who have availed of home loans under the fixed rate regime, no interest rate hike has been imposed. Earlier this month, the company hiked the interest payable by those belonging to the fixed rate regime to 14 %. Fortunately, these loanees have been spared a second dose of hike. The country’s second largest bank, the ICICI Bank which is also into housing finance, also announced a similar hike in interest rates on its home loans. The hiked rates will come into force from August, 2008.