Expect home loan rates to remain stable: GIC Housing

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In an interview with CNBC-TV18, Yogesh Lohiya, Chairman of GIC Housing spoke about the company's home scheme and the road ahead.

Below is a verbatim transcript of the interview. Also watch the video.

Q: What is this limited period home loan scheme? How has the interest shaped up for the scheme?

A: This scheme has been launched from October 1, 2009. Basically, GIC Housing is dealing with retail business and not on with builders or anything like that. The scheme basically is given on an individual household. The interest rates range is something like 7.95%. The benefit comes from we are not charging processing fee at all. It's free of cost. This is a good scheme for individual retailers who take loans from GIC Housing Finance.

Q: How are your sanctions shaping up in the current quarter because in the Q2 you did sanctions of about Rs 164 crore?

A: Our sanctions were not that comfortable in Q2 and we are expecting in Q3 - because this is the period where a lot of festivals and things are there - so we are expecting about Rs 200 crore in this quarter.

Q: But is it looking like you will achieve it because out of the 90 days this quarter about 50 days are over?

A: We are positive and we have done a lot of ground realities. We have put the marketing people on the job for various centers, which are more towards these housing loan facilities, especially centres like in Kerala, some parts of the Western side and more on South. We have been catching up and a lot of enquiries ave been coming. We are looking to do a good job in days to come.

Q: Do you think housing loan rates can fall further considering that there seems to be a lot of money in the system?

A: I don't anticipate housing loan rates to go down because the realty market is going up. We feel either it would be stable or it may slightly marginally go up.

Q: Do you think that the rates might go up in the few months?

A: It would be just a marginal increase and not any big increase.

Q: How will your margins shape up in Q3 compared to second quarter?

A: We feel margins would be maintained at 15%.

Q: I meant your spreads between your cost of money and the rate at which you lend, that is, your net interest margins?

A: We expect it to be at 1-2%.