Latest Home Loan News

HDFC To Be Merged With HDFC Bank To Create Financial Behemoth. Here's The Rationale

On Monday, 04 April, 2022, HDFC Limited announced that it will merge with HDFC Bank. The share merger ratio will be 42 shares of HDFC Bank to 25 shares of HDFC. Post the merger, 100 percent shares of HDFC Bank will be held by the public shareholders. 41 percent shares of HDFC Bank will be owned by the existing shareholders of HDFC.

HDFC Bank said that the share exchange ratio is fixed based on the joint valuation report issued by the independent valuers. Also, a SEBI registered merchant banker supports the fairness opinion.

This merger will help HDFC Bank build a housing loan portfolio and expand its existing customer base. The bank said that their platform will provide a well-diversified low cost funding base to the long tenor loans offered by HDFC.

HDFC has set up 445 offices across India which can be used to sell all the products offered by both HDFC Limited and HDFC Bank. HDFC has financed more than 90 lakh houses across the country. Its affordable home loans and business in the rural area will help HDFC Bank diversify their portfolio. In turn,the private lender can provide flexible and cost-effective mortgage offerings to customers.

Due to its high level of current and savings accounts deposits, HDFC Bank has access to funds at lower costs. As a result, the merger of HDFC with HDFC Bank will bring more competitive housing products to the market.

- Apr 05, 2022

HDFC Ltd Approves Highest Ever Rs. 2 Lakh Crore Home Loans In FY22

HDFC Ltd. has approved over Rs. 2 lakh crore worth of home loans in the fiscal year 2022. For a financial year, this is their highest ever. As per the official statement issued by HDFC Ltd., their thrust on digital initiatives and the current surge in demand for housing have helped them achieve the target of Rs. 2 lakh crore.

The growth of the housing finance segment is a result of the low-interest rates, favourable demographics, stable property prices, stamp duty rates of each state, and the government’s thrust on housing through credit linked subsidy schemes like PMAY.

HDFC Ltd. has increased from their last year’s home loan approvals worth Rs. 1.55 lakh crore and has shown a growth of 30%. They achieved the target through digitalisation. HDFC set up a digital platform for loans and retail deposits, initiated ‘HDFC Customer Connect’ to solve customer queries and launched virtual offices for customer services. This increased their online retail loans from less than 20% to over 89% post-pandemic.

Of the total home loans approved by December 31, 2021, 30% in volume terms and 13% in value terms, have been to customers from the Economically Weaker Section and Low Income Groups. According to Renu Sud Karnad, Managing Director of HDFC Ltd, this demand is a structural one and will continue to rise in affordable and high-end markets.

- Mar 25, 2022

Budget 2021: Further boost to the affordable housing sector and buyers

One of the Budget announcements that caught everyone’s attention included affordable housing incentives. 

In the 2019 Budget, an additional interest deduction of Rs 1.5 Lakhs was announced on affordable housing loans. In Budget 2021, extending the eligibility for this deduction upto 31st March 2022 was proposed. What this effectively amounts to is an enhanced interest deduction upto Rs. 3.5 Lakhs for persons buying a home, costing upto Rs. 45 Lakhs.

Furthermore, affordable housing projects, too, received an additional tax holiday for a year. The Finance Minister is clearly keen on boosting demand and supply in the affordable housing segment.

- February 25, 2021

RBI rationalises risk weights on new loans till 31 March 2022

Recently, the Governing Board of the National Health Authority (NHA) sat and reviewed the implementation of health facilities under the PMJAY scheme. The meeting concluded with approval from the authorities to integrate the existing health facilities of Central Ministries with PMJAY for employees (government as well as contractual employees). Other beneficiary groups, such as building and construction workers, manual scavengers, road accident victims, and Central Armed Police Force (CAPF) personnel, can also access these facilities.

- February 27, 2021

Home loan interest rates at a new low

It is a suitable climate to invest in property as interest rates on home loans have received a significant haircut. Renowned lenders such as SBI are providing home loans at an all-time low interest rate of 6.70% onwards, which would be further determined by your loan amount and CIBIL score . The lender is also providing a 100% waiver on processing fees and additional special concessions on Women’s Day and using the YONO app alongside.

Private lenders such as Kotak Mahindra Bank are also offering home loans at a record interest rate of 6.65%. The lender is also providing a 100% waiver on processing fees.

It must be noted that both of the aforementioned rate cuts are valid only up till 31st March 2021.

- March 5, 2021