Loan rates may come down

Housing Loan rates for existing borrowers may come down The government on Thursday said it is talking to bankers to cut the lending rates for home loans even for the existing borrowers. "Yes, we are talking to bankers as their prime lending rate (PLR) is refixed. They (banks) must reset the loan rates for past borrowers also. As PLR is brought down, even floating rates must come down," Home Minister P Chidambaram said in the Lok Sabha. The former finance minister replies on finances in Parliament from the government side. Chidambaram's statement assumes importance as public sector banks on Monday said interest rate for fresh home loans of up to Rs 5 lakhs will not exceed 8.5 per cent, while the lending rate is a maximum of 9.25 per cent for new housing loans in the bracket of Rs 5 lakh and Rs 20 lakh. However, the existing borrowers did not get such relief. "Questions have been rightly asked, what about the past loans at floating rate of interest," he said in reply to a debate in the Lower House on Review of the Economic Situation in the Country. Chidambaram said housing is an important sector and a major driver of the economy. "Steel, cement, bricks, pipes, wires, electrical equipment, construction, labour everything depends on housing," he added.


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