LIC Housing Finance Lowers Home Loan Interest Rates To 7.15% Following RBI Repo Rate Cut

LIC Housing Finance Ltd. has reduced interest rates on new home loans to 7.15% onwards, effective December 22, 2025, offering relief to prospective homebuyers. The move follows the Reserve Bank of India’s Monetary Policy Committee (MPC) decision to cut the repo rate by 25 basis points during its policy meeting held on December 5, 2025. 

This decision was part of RBI’s continued accommodative stance to support economic growth and improve credit offtake. The revised LIC Housing Finance home loan rates apply to new borrowers and are linked to individual credit profiles.

How Does The 7.15% Home Loan Rate Impact Borrowers?

The reduction in LIC Housing Finance home loan rates is expected to significantly improve housing affordability, particularly for first-time buyers. A starting rate of 7.15% lowers monthly EMIs and reduces the overall interest burden over the loan tenure. 

According to Moneycontrol, borrowers with higher CIBIL scores are more likely to qualify for the lowest rates offered by the housing finance company.

This rate cut reflects the transmission of RBI’s monetary easing into the retail lending segment. As per the RBI Monetary Policy Report, December 2025, issued under Serial No. MPC/2025-26/06, the central bank reduced the repo rate by 25 bps, taking the total repo rate cut in 2025 to 125 bps. The report can be accessed on the RBI website under Monetary Policy Statements and Reports, dated December 5, 2025.

Key Details Of The Revised LIC Housing Finance Home Loan Rates

What Developments Led To This Rate Cut?

Throughout 2025, the RBI pursued a series of policy rate reductions to stimulate lending. The repo rate was cut cumulatively by 125 basis points across policy reviews in February, April, June and December 2025, with the final cut announced on December 5, 2025. These measures were aimed at improving liquidity conditions and supporting interest-sensitive sectors such as housing.

Following the December policy announcement, several lenders began adjusting their lending rates. 

According to the Economic Times BFSI, LIC Housing Finance confirmed that its revised rates would be effective from December 22, 2025, making it one of the most competitive offerings among large housing finance companies.

Home Loan Rates Comparison After RBI Repo Cuts

According to the Times of India, the reduction is expected to boost buyer sentiment, especially in the affordable and mid-income housing segments.

What Did LIC Housing Finance Management Say?

Commenting on the development, Tribhuwan Adhikari, Managing Director and CEO of LIC Housing Finance Ltd., stated that RBI’s cumulative 125 bps repo rate cut in 2025 had provided meaningful relief to homebuyers. 

He added that the latest reduction in lending rates is expected to boost confidence among first-time homebuyers and set a positive demand outlook for the housing market in 2026. His were reported by multiple outlets, including Rediff Money. 

Where Borrowers Can Track LIC Housing Finance Loans

Borrowers seeking to check their application or repayment status can refer to this genuine LoansJagat resource, which provides guidance on tracking LIC Housing Finance loans and related services:

Conclusion

LIC Housing Finance’s decision to cut home loan interest rates to 7.15% from December 22, 2025 demonstrates effective transmission of RBI’s monetary easing measures. The move is expected to enhance housing affordability and support demand momentum as the real estate sector heads into 2026.
 

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