RBI's 125 bps Rate Cuts in 2025: Will Home Loan Relief Continue in 2026?

• RBI cut the repo rate by 125 bps in 2025, from 6.5% to 5.25%, bringing significant relief to home loan borrowers.
• Four rate cuts in Feb, Apr, Jun, and Dec 2025 led to cheaper EMIs and shorter loan tenures for floating-rate loans.
• Existing borrowers saw substantial interest savings, with a Rs 50 lakh loan potentially saving Rs 18.32 lakh by shortening tenure.
• Public sector banks fully transmitted the cuts to new borrowers, while some private banks like ICICI Bank and HDFC Bank adjusted spreads.
• Experts predict further rate cuts in 2026, with RBI Governor Sanjay Malhotra expecting low rates to continue, making it a borrower-friendly year.

Why It Matters: 2025 brought major home loan relief; 2026 likely to continue borrower-friendly rates with potential further cuts.