Home Loan


Found your fantasy house but struggling with the price tag? We can help with Home Loans designed for your needs. Our low interest rates and easy EMI plans can help unlock the door to your future.


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Loan Against Property


Our Loans Against Property can help you through life’s biggest moments. Weddings, personal passions, educational fees or career changes - we’ve got you covered. Refinance any existing commercial or residential property at the best rates today.


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Balance Transfer


With our Balance Transfer option you can transfer your existing home loan to Godrej Capital and enjoy the benefits of a plan that works for you. Along with interest rates tailored to your comfort, enjoy higher eligibility, along with a Top-Up loan, to take care of your extra needs.


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Plot Loan


Found the perfect spot to build your future? Our Plot Loans can help make it yours. Our loans offer you the financial help, low interest rates and flexible payment options you need to construct the home of your dreams.


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Business Loan


We give you the courage to take that next step that your business needs. Godrej Capital Business Loans empower you with customizable financing solutions to grow your business to the next level!


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Professional Loan


We empower you to scale your medical practice with modern equipment, improve patient facilities or hiring skilled staff with our Professional Loan for Doctors.


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Udyog Loan Agaginst Property


Are you an MSME owner looking to scale your business operations? Take your business to new heights with Godrej Capital Udyog Loan Against Property. Our loan solutions enable business owners to get higher loan eligibility by allowing multiple sources of income to be considered. With quick loan approvals and attractive interest rates, our goal is to help your business achieve growth.


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Commercial Property Loan


Take your business to the next level with a Commercial Property Loan that finances construction, extension or improvement to make your business goals become reality. With plans designed for your life, you can rest assured that your business empire is in safe hands.


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Wondering What Affects Your Home Loan Rate of Interest? Let’s Find Out (Part II)

In the first part of the series, we talked about customer-centric factors that affect home loan rates of interest.


Now comes the second part, where we will talk about the macroeconomic factors that impact your home loan interest rate. What are these? Let’s find out.


1.  Repo Rate

Of late, the repo rate has been a talking point for all - from economists to commoners. The Reserve Bank of India (RBI) in its latest monetary policy committee meet, hiked the repo rate by 50 bps to 4.90%. With repo rates going up, the home loan rate of interest will also shoot up. If you have availed a home loan on a floating rate of interest, in all likelihood, you will receive or would have received an intimation from your lender regarding a hike in the rate of interest.


What is Repo Rate?

It is the rate at which the RBI lends money to commercial banks. With repo rates going high, the cost of borrowing for NBFCs has become dearer. In other words, it has become more expensive NBFCs to avail funds from commercial banks. In a bid to offset this cost, they have little option but to pass on the burden of the increased hike upon borrowers.


Your home loan interest rate may further go up in such a situation. However, if you have availed of a home loan on a fixed rate of interest, the hike in repo rate will have no impact. This is because the interest rate will remain the same throughout the loan tenure.


2.   Inflation

Inflation not only reduces the purchasing power of money but also has an impact on the home loan interest rate, albeit a little differently. When inflation shoots up, as it is now, central banks aim to reduce the supply of money in the economy. For this, they hike the repo rate.


This acts as a disincentive for lenders, including NBFCs, to borrow money. If they need to borrow, they need to pay a high cost, some part of which they pass on to borrowers by hiking rates. So, when inflation is on the rise, the RBI tries to bring it under control by increasing the repo rate. And in such a scenario, home loan interest rates are bound to go up.


3.    MCLR

MCLR or marginal cost of fund-based lending rate (MCLR) is a benchmark interest rate introduced by the RBI for Banks in 2016. MCLR replaced the then-existing base rate system and was introduced to ensure better pricing of floating loan rates by banks.MCLR is an internal benchmark for Banks. Under the MCLR regime, lenders need to adjust their interest rates as soon as there is any change in the repo rate. However, in 2019, RBI rolled out a directive for Banks to link housing loan directly to Repo Rate for better transmission.



Hike in MCLR by Lenders

Following a spike in the repo rate, several lenders have increased their MCLR rates. This has increased home loan interest rates and the subsequent EMIs. If your home loan is linked to the lender’s MCLR rates, in all likelihood, your interest rates will go up and you need to pay higher EMIs.


Should you opt for home loans through other financers such as NBFCs, please note that their lending rate is determined by their own internal policies. You can find out more about the lending rate on their respective websites.


4.    Retail Prime Lending Rates

Retail Prime Lending Rate (PLR) is the rate at which housing finance companies lend to their customers. It is the benchmark against which lenders price their loans to customers. An increase in retail prime lending rate will increase your Home Loan interest rates and push up the EMIs.


Of late, prominent housing finance companies have increased their retail prime lending rates, resulting a spike in Home Loan EMIs.


The Bottomline

Unlike customer-centric factors that are under your control to some extent, macroeconomic factors are not. However, what you can do is talk to your lender and find out ways to facilitate repayment. Lenders can offer you repayment flexibility or adjust the loan tenure so that you don’t feel the pinch of increased EMIs.


Godrej Capital is the financial services arm of Godrej Group which offers home loans, Loan Against Property and other secured loans. With innovative products and offerings, customers can get hassle-free loans on easy terms and conditions. Click here to know more about the offering.



Disclaimer:The above information is for illustrative purpose only. For more details, please refer to the product or service document and/or connect with our customer representative prior to making any financial decision.