2 min
12 May 2025
The Reserve Bank of India has announced another home loan interest rate cut, bringing its repo rate down by 25 basis points to 6%. This marks the second home loan interest rate cut of 2025. For millions of homeowners and potential buyers, this news brings hope of lower EMIs and more affordable housing. The cut follows a previous reduction in February, showing RBI's commitment to support growth in the housing sector. With banks expected to pass on these benefits to customers, many Indians may soon enjoy lower monthly payments on their home loans.
This article will explore how the home loan interest rate cut affects you and what steps you can take to benefit from this change.
Impact of RBI repo rate cut
The recent home loan interest rate cut by RBI has sent ripples through the banking sector. Major public sector banks have already announced reductions in their lending rates. These banks have adjusted their external benchmark-linked lending rates, making loans more affordable for the average Indian. The repo rate serves as the standard benchmark for most banks when setting their interest rates.
When the RBI cuts rates, banks can borrow money at lower costs. This saving gets passed on to you, the customer. Check your eligibility for Bajaj Housing Finance Home Loans to see how these new rates might benefit you. You may already be eligible – find out by entering your mobile number and OTP.
How does it affect borrowers?
The home loan interest rate cut directly impacts your wallet if you have a floating interest rate loan. Since most banks use the repo rate as their external benchmark, a lower repo rate means lower interest costs for you. For instance, a 25 basis point reduction on a Rs. 50 lakh loan can lower your EMI by Rs. 800-1,000 per month.
This change happens fastest for repo-linked home loans, which adjust almost immediately after the RBI announcement. Fixed-rate borrowers, however, will not see any change in their EMIs. The full impact typically takes 1-3 months to reflect in your account as banks update their lending rates.
EMIs set to fall, but not for everyone
While the home loan interest rate cut brings good news, not all borrowers will benefit equally. Those with floating rate loans linked to the repo rate will see the quickest relief. According to banking experts, the lowest home loan rates may soon drop below 8% for prime borrowers with credit scores above 750.
However, many Indians still have loans based on older benchmarks like MCLR (Marginal Cost of Funds based Lending Rate) or even the base rate. These loans respond more slowly to RBI rate cuts. If you are paying 50 basis points or more above current market rates, consider switching to a repo-linked home loan to save money.
Bajaj Finserv offers home loans with interest rates starting from just 7.99%* p.a.. Check your loan offers today to see if you qualify for better rates. You may already be eligible – find out by entering your mobile number and OTP.
Here is how current home loan rates compare across lenders:
Why the cut matters now
The timing of this home loan interest rate cut is significant. With inflation cooling down and surplus liquidity in the banking system, the RBI now has room to focus on boosting demand. System liquidity crossed Rs. 1.5 lakh crore in April, creating better lending conditions for banks.
For potential homebuyers who have been waiting on the sidelines, this rate cut provides the push they need. Lower EMIs make home ownership more affordable, especially in the mid-income segment. This could spark increased activity in the real estate market after months of cautious buying.
For existing borrowers, this is the perfect time to review your loan terms. Check if you qualify for a better rate with Bajaj Finserv, which offer interest rates starting from 7.99%* p.a. and loan amounts up to Rs. 15 crore*. You may already be eligible – check your offers now by entering your mobile number and OTP.
Rising home prices add pressure
While the home loan interest rate cut offers relief, home prices continue to climb. According to ANAROCK Research, housing prices in India's top seven cities jumped 17% year-on-year by Q1 2025. In NCR and Bengaluru, prices rose by a steep 34% and 20% respectively. The average rate in these cities is now Rs. 8,835 per sq. ft.
This price increase puts pressure on buyers to act quickly. Even with lower interest rates, waiting too long might mean paying more for the same property. Banks may not pass on the full benefit of rate cuts immediately due to their own margin pressures and funding costs.
In this scenario, finding a lender with competitive rates becomes even more crucial. Bajaj Finserv stands out with interest rates starting from 7.99%* p.a. and quick loan approval within 48 hours*. Check your eligibility today to lock in favourable terms before home prices rise further. You may already be eligible – find out by entering your mobile number and OTP.
What should borrowers do now?
With the latest home loan interest rate cut, smart borrowers should take these steps:
How to apply for Bajaj Finserv home loan
Getting a home loan from Bajaj Finserv is straightforward and hassle-free:
Eligibility criteria to get home loan from Bajaj Finserv
To qualify for a Bajaj Housing Finance Home Loan, you need to meet these requirements:
With home loan interest rates starting from 7.99%* p.a., Bajaj Finserv offers some of the most competitive terms in the market. Check your eligibility now and take advantage of the current rate environment. You may already be eligible – find out by entering your mobile number and OTP.
Conclusion: Making the most of lower interest rates
The recent home loan interest rate cut by RBI presents a golden opportunity for both existing borrowers and potential homebuyers. With rates potentially dropping below 8% for prime borrowers, now is the time to act. Bajaj Finserv stands ready to help you capitalise on this favourable environment with their comprehensive home loan solutions.
Bajaj Housing Finance Home Loans offer several key advantages:
Interest rates starting from just 7.99%* p.a..
Loan amounts up to Rs. 15 crore* based on eligibility.
Flexible repayment terms up to 32 years.
Quick approval within 48 hours*.
No foreclosure fees for individual borrowers with floating interest rates.
Hassle-free application with doorstep document pickup.
Balance transfer facility with top-up loans up to Rs. 1 crore.
Whether you are looking to buy your first home, upgrade to a larger property, or refinance an existing loan, the current rate environment makes this an ideal time. With Bajaj Finserv's customer-friendly approach and competitive rates, you can secure your dream home while keeping your EMIs affordable.
Do not miss this opportunity to benefit from the home loan interest rate cut. Check your eligibility for a Bajaj Housing Finance Home Loan today and take the first step toward affordable home ownership. You may already be eligible – find out by entering your mobile number and OTP.
This article will explore how the home loan interest rate cut affects you and what steps you can take to benefit from this change.
Impact of RBI repo rate cut
The recent home loan interest rate cut by RBI has sent ripples through the banking sector. Major public sector banks have already announced reductions in their lending rates. These banks have adjusted their external benchmark-linked lending rates, making loans more affordable for the average Indian. The repo rate serves as the standard benchmark for most banks when setting their interest rates.
When the RBI cuts rates, banks can borrow money at lower costs. This saving gets passed on to you, the customer. Check your eligibility for Bajaj Housing Finance Home Loans to see how these new rates might benefit you. You may already be eligible – find out by entering your mobile number and OTP.
How does it affect borrowers?
The home loan interest rate cut directly impacts your wallet if you have a floating interest rate loan. Since most banks use the repo rate as their external benchmark, a lower repo rate means lower interest costs for you. For instance, a 25 basis point reduction on a Rs. 50 lakh loan can lower your EMI by Rs. 800-1,000 per month.
This change happens fastest for repo-linked home loans, which adjust almost immediately after the RBI announcement. Fixed-rate borrowers, however, will not see any change in their EMIs. The full impact typically takes 1-3 months to reflect in your account as banks update their lending rates.
EMIs set to fall, but not for everyone
While the home loan interest rate cut brings good news, not all borrowers will benefit equally. Those with floating rate loans linked to the repo rate will see the quickest relief. According to banking experts, the lowest home loan rates may soon drop below 8% for prime borrowers with credit scores above 750.
However, many Indians still have loans based on older benchmarks like MCLR (Marginal Cost of Funds based Lending Rate) or even the base rate. These loans respond more slowly to RBI rate cuts. If you are paying 50 basis points or more above current market rates, consider switching to a repo-linked home loan to save money.
Bajaj Finserv offers home loans with interest rates starting from just 7.99%* p.a.. Check your loan offers today to see if you qualify for better rates. You may already be eligible – find out by entering your mobile number and OTP.
Here is how current home loan rates compare across lenders:
| Banks | Starting interest rate (p.a.) |
| Bajaj Finserv | 7.99%* p.a. onwards |
| Kotak Mahindra Bank | 8.65% p.a. onwards |
| Union Bank of India | 8.10% p.a. onwards |
| Bank of Baroda | 8.15% p.a. onwards |
| Central Bank of India | 8.10% p.a. onwards |
| State Bank of India | 8.25% p.a. onwards |
Why the cut matters now
The timing of this home loan interest rate cut is significant. With inflation cooling down and surplus liquidity in the banking system, the RBI now has room to focus on boosting demand. System liquidity crossed Rs. 1.5 lakh crore in April, creating better lending conditions for banks.
For potential homebuyers who have been waiting on the sidelines, this rate cut provides the push they need. Lower EMIs make home ownership more affordable, especially in the mid-income segment. This could spark increased activity in the real estate market after months of cautious buying.
For existing borrowers, this is the perfect time to review your loan terms. Check if you qualify for a better rate with Bajaj Finserv, which offer interest rates starting from 7.99%* p.a. and loan amounts up to Rs. 15 crore*. You may already be eligible – check your offers now by entering your mobile number and OTP.
Rising home prices add pressure
While the home loan interest rate cut offers relief, home prices continue to climb. According to ANAROCK Research, housing prices in India's top seven cities jumped 17% year-on-year by Q1 2025. In NCR and Bengaluru, prices rose by a steep 34% and 20% respectively. The average rate in these cities is now Rs. 8,835 per sq. ft.
This price increase puts pressure on buyers to act quickly. Even with lower interest rates, waiting too long might mean paying more for the same property. Banks may not pass on the full benefit of rate cuts immediately due to their own margin pressures and funding costs.
In this scenario, finding a lender with competitive rates becomes even more crucial. Bajaj Finserv stands out with interest rates starting from 7.99%* p.a. and quick loan approval within 48 hours*. Check your eligibility today to lock in favourable terms before home prices rise further. You may already be eligible – find out by entering your mobile number and OTP.
What should borrowers do now?
With the latest home loan interest rate cut, smart borrowers should take these steps:
- Check your loan benchmark: If your loan is not repo-linked, consider switching to take advantage of immediate rate reductions. Bajaj Finserv offers flexible repayment options with terms up to 32 years.
- Negotiate with your lender: If your credit score has improved since you took the loan, ask for a better rate. Many banks will reduce rates for valuable customers rather than lose them.
- Consider balance transfer: A home loan balance transfer to Bajaj Finserv could save you money. They offer top-up loans up to Rs. 1 crore with no restriction on usage.
- Review your EMI vs. tenure: When rates fall, you can either reduce your EMI or keep the same EMI and reduce your loan tenure. The latter saves more money in the long term.
- Use rate cuts wisely: If your EMI decreases, consider using the extra money to make partial prepayments on your loan. This could save lakhs in interest over the life of the loan.
How to apply for Bajaj Finserv home loan
Getting a home loan from Bajaj Finserv is straightforward and hassle-free:
- Visit the website: Go to Bajaj Finserv's home loan page and click "APPLY."
- Enter basic details: Provide your name, mobile number, and employment type.
- Select loan type: Choose from fresh home loan, balance transfer, or top-up options.
- Complete verification: Submit your OTP and share additional details like income and required loan amount.
- Submit application: After entering your date of birth, PAN, and other required information, submit your application.
Eligibility criteria to get home loan from Bajaj Finserv
To qualify for a Bajaj Housing Finance Home Loan, you need to meet these requirements:
- Nationality: You must be an Indian citizen living in India.
- Age: Salaried applicants should be 23-67 years old; self-employed professionals 23-70 years (upper limit at loan maturity).
- Credit score: A CIBIL score of 725 or higher improves your chances of approval.
- Occupation: You should be a salaried employee, professional individual, or self-employed person.
With home loan interest rates starting from 7.99%* p.a., Bajaj Finserv offers some of the most competitive terms in the market. Check your eligibility now and take advantage of the current rate environment. You may already be eligible – find out by entering your mobile number and OTP.
Conclusion: Making the most of lower interest rates
The recent home loan interest rate cut by RBI presents a golden opportunity for both existing borrowers and potential homebuyers. With rates potentially dropping below 8% for prime borrowers, now is the time to act. Bajaj Finserv stands ready to help you capitalise on this favourable environment with their comprehensive home loan solutions.
Bajaj Housing Finance Home Loans offer several key advantages:
Interest rates starting from just 7.99%* p.a..
Loan amounts up to Rs. 15 crore* based on eligibility.
Flexible repayment terms up to 32 years.
Quick approval within 48 hours*.
No foreclosure fees for individual borrowers with floating interest rates.
Hassle-free application with doorstep document pickup.
Balance transfer facility with top-up loans up to Rs. 1 crore.
Whether you are looking to buy your first home, upgrade to a larger property, or refinance an existing loan, the current rate environment makes this an ideal time. With Bajaj Finserv's customer-friendly approach and competitive rates, you can secure your dream home while keeping your EMIs affordable.
Do not miss this opportunity to benefit from the home loan interest rate cut. Check your eligibility for a Bajaj Housing Finance Home Loan today and take the first step toward affordable home ownership. You may already be eligible – find out by entering your mobile number and OTP.
