After rate hike, ask your lender to increase home loan EMI, not tenure

A 50-bps hike on a Rs 50 lakh loan of 20-year tenure would increase the EMI by Rs 1,545

Interest rates on home loans are set to rise once again with the Reserve Bank of India (RBI) hiking the repo rate by 50 basis points (bps) to 5.4 per cent. After the latest hike, the repo rate has increased by 140 basis points in the current rate hike cycle.

A few lending institutions such as ICICI Bank, Bank of India and Indiabulls Housing Finance had hiked their rates a few days ahead of the RBI’s Monetary Policy Committee (MPC) meeting. After the RBI’s measure, expect players across the board to hike their rates, resulting in higher burden for home loan