Switch lenders if home loan rate is too high; go for banks over HFCs

New borrowers should go for banks over HFCs as the new benchmark - MCLR - is more transparent

As lenders hike their benchmark rates, new customers will see their eligibility go down. Existing borrowers on marginal cost-based lending rates (MCLR) would not be affected much. But if your loan is not linked to MCLR or you are a borrower with a housing finance company, you will need to act if the interest rate on your loan is too high, say, over nine per cent.

HDFC recently increased its lending rates by up to 20 basis points (bps) for the first time since December 2013, marking a shift in the interest rate trajectory. 

In March, State Bank of India,