RBI holds repo rate in February 2026: What it means for home loan borrowers

The Reserve Bank of India (RBI) has once again kept the repo rate unchanged at 5.25%. The decision was made during the three-day RBI’s monetary policy committee, which started on Wednesday (February 4-6).

What this means for home loan borrowers

For home loan borrowers, this decision offers some immediate respite. By holding the rate steady, the RBI has essentially ensured that existing EMIs will not go up for now.

For new borrowers, this is a good time to compare loan offers across banks and consider fixed-rate options if they are worried about future hikes.

"RBI's decision to keep the repo rate at 5.25% means that home loan EMIs will not change either. This will keep buyers engaged but does nothing to lift demand further and does nothing to make housing more affordable. The upside is that current house loan borrowers will not experience any EMI shocks for now, and new borrowers can plan their housing purchases with the benefit of predictability," said Anuj Puri, Chairman - ANAROCK Group.

Will your home loan EMI increase or decrease?

Since most new home loans today are linked to the repo rate (through external benchmark-linked lending rates or EBLR). By holding the rate steady, the RBI has effectively kept monthly repayments unchanged.

For those with loans linked to older systems like the base rate or MCLR, now might be a good time to review your loan agreement. Shifting to a repo-linked home loan could help you benefit from better rate transparency and quicker transmission in the future.

"With the RBI maintaining a status quo on the repo rate at 5.25 percent, policy continuity has brought much-needed stability for home loan borrowers. An unchanged rate has ensured that EMIs on floating-rate loans remain steady, offering predictability at a time when housing demand continues to stay resilient across major urban markets. This clarity on borrowing costs has supported affordability and enabled homebuyers, especially first-time buyers to plan long-term purchases with greater confidence," said Manju Yagnik, Vice Chairperson of Nahar Group and Senior Vice President of NAREDCO Maharashtra

"For the real estate sector, an unchanged rate environment brings stability to funding costs, supports disciplined cash-flow management, and enables uninterrupted project execution. From a homebuyer’s perspective, predictable lending rates preserve EMI visibility and reinforce purchase confidence. Overall, a steady monetary policy framework creates conducive conditions for sustainable demand and balanced growth across residential markets," said Dharmendra Raichura - VP & Head of Finance, Ashar Group.

The RBI typically conducts six bi-monthly meetings in a financial year, where it decides interest rates, money supply, inflation outlook, and various macroeconomic indicators.