Home Loans Getting Cheaper: Now, ICICI Bank Joins The Party

India's largest private lender ICICI Bank on Tuesday cut home loan rates by 0.25 per cent or 25 basis points, effective from April 14.

For women applicants now the home loan rate stands at 9.85 per cent, for others it is 9.90 per cent.

ICICI bank also reduced its base rate by 0.25 per cent to 9.75 per cent effective April 10. Base rate is the rate below which banks can't lend to customers. "This move will benefit all existing customers of floating home loans, whose home loan rates will be reduced by 25 basis points as per the change in "I-Base"," the bank said.

ICICI Bank's move comes close on the heels of other banks like SBI, HDFC who also have slashed home loan rates.

ICICI bank has matched the rate that SBI is offering, after its 0.25 per cent cut in home loans rates on Sunday.

HDFC had cut its rates on Friday to 9.90 per cent, which is applicable for both new and existing customers.
Competitive lowering of interest rates would benefit home loan consumers, who have been struggling under high EMIs or equated monthly instalments  for years.

Interest rates are likely to fall even further if the Reserve Bank of India or RBI cuts its lending rate in the coming months. The RBI has so far lowered its repo rate by 0.50 per cent or 50 basis points this year, but analysts expect the central bank to ease further considering inflation is expected to remain soft because of falling crude prices.

Big lenders started cutting their base rates last week after RBI Governor Raghuram Rajan pulled them up for not passing the benefits of lower rates to borrowers. SBI was the first to cut rates; on Tuesday, it lowered its base rate by 15 basis points to 9.85 per cent.