HDFC Corporate Update

Mortgage Market in India HDFC TAX INCENTIVES HAVE LOWERED THE EFFECTIVE RATES ON MORTGAGES FY 2021 FY 2002 FY 2000 Loan amount 3,190,000 3,190,000 3,190,000 Nominal Interest Rate (%) 6.70% 10.75% 13.25% Max deduction for interest allowed 200,000 150,000 75,000 Deduction on principal 150,000 20,000 20,000 Tax rate 30.90% 31.50% 34.50% Tenor (years) 20 20 20 Total amount paid per year 363,730 359,400 421,068 Interest component 213,730 342,925 422,675 Principal repaid 150,000 16,475 (1,607) Tax amount saved 108,150 53,550 32,775 Effective interest paid on home loan 105,580 289,375 389,900 Effective interest on home loan 3.3% 9.1% 12.2% Note: Union Budget 2021-22: Additional interest deduction of Rs.1.5 lac for loans sanctioned from April 1, 2021 to March 31, 2022. This is for first-time home-buyers; house cost: up to Rs 4.5 mn. 12

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