Mortgage lender, LIC Housing Finance has launched a new scheme for home loan borrowers to protect them from interest rate uncertainties which prevail in the market.

The new scheme, named 'Fix-o-Floaty' aims to provides shield to the borrowers against the rampant interest rate fluctuations.

Under the scheme, home loan borrowers can opt to pay fixed interest for a period of 3 years, at a rate of 8.9 percent for loans amounts up to Rs 75 lakh and at rate of 9.5 percent for loans above Rs 75 lakh. The customer can however shift to FRR rates within this period of three charges at no additional charges.

After the term of three years, the rate of interest will be reset at the then prevailing rates (FRR). The customer also has a choice of shifting to the floating interest rate without any additional charges, within the first three years.

The company has also reduced FRR for new customers. The interest on new home loans up to Rs 75 lakh has been lowered to 8.5 percent, from the earlier 8.75-9.75 percent. On loans above Rs 75 lakh, the rates have been reduced to 9.50 percent, from the previous rate of 10.25 percent.

Leading player in mortgage lending, LIC Housing Finance Ltd has slashed interest rates by 50 basis points for existing home loan borrowers.

LIC HF, a subsidiary of largest life insurance company in India, Life Insurance Corporation (LIC).