Private sector lenders ICICI Bank and Kotak Mahindra on Tuesday announced low rates of 8.25 per cent and 8.49 per cent respectively for home loans, intensifying the cut-throat competition sparked by SBI and HDFC.
India's second largest lender ICICI Bank said it would offer a fixed rate of 8.25 per cent for two years for new home loans. The rate would be applicable to loans sanctioned between December 1, 2009 and January 31, 2010, and the first disbursement should be before March 31 2010, the bank said.
From the third year onwards, the bank would charge the floating interest rate depending upon the prevailing reference rate, the lender said.
Unlike rival SBI, which offer low interest rate in two slabs for loans of Rs 5 lakh and Rs 30 lakh, ICICI Bank is offering low rates to all new loans irrespective of amount.
Kotak also said the special offer of 8.49 per cent can be availed for all new loans irrespective of the loan amount for 30 months. But the offer is limited till January 31, 2010.
It will charge floating rates after the 30-month period, which will be decided based on the retail prime lending rate.
Last week, eyeing to corner bigger pie in India's multi-crore rupees home loan market, premier housing finance company HDFC offered 8.25 per cent rate up to March 31, 2012. This offer was to counter market leader SBI's offer of 8 per cent rate in the first year.