Hi, i had taken a homeloan for 9% fixed for 5 years for 15 lacks for 15 years. Now first 5 years are over, bank has given me two options. 13.25% fixed for next 5 years or 11.35% floating with 1% prepayment charges on outstanding amount (my outstanding as of today is 11,25,00). I can close this loan by liquidating some FD, which is at 13% interest. Should i close this loan or should i change it to floating rate?
Dear Harsh Roongta, I have taken housing loan of 10 laks for a period of 10 years from Federal Bank and started repayment of EMI RS. 20,000/-from July 2008. My present balance is Rs. 540439/-, I wish to payback this amount and close the loan in July 2012 with a restructured EMI. Please advice me whether the Bank has any right to ask for preclosure/prepayment penalty? If the penalty is applicable how much the bank can demand? With regards, PramodKumar
Re: Housing Loan preclosure/prepayment penalty
by PramodKumar MR on Oct 14, 2011 01:21 PM
How to get my question answerred through this forum? This was unanswerred for about 3 month! PramodKumar
This is just to warn all those who are planning to take home loan and end up doing same mistake as what I did.
Here is how I got into the trap. I took a home loan from Standard Chartered Bank (SCB) in May 2007 for 46 Lkh at 9% if I am not wrong with 16 years term. In last 50 months, I have paid close to Rs.26Lkh and just recently got to know that the total principal deducted is only Rs.2.5Lkh and rest everything has gone into paying interest due to increase in the interest rate which is now standing at 14%. and a term of 35.4 months still to go. SCB = Suck Customer Blood.
When inquired I got to know that I will be paying same amount for next 48 months and surprisingly the bank will deduct only Rs.25000/- (twenty five thousand approx.) out of Rs.26Lkh I will be paying as EMI unless and until I don't pay them a switch charges of Rs.35000/- to change my interest rate from 14% to 10.9% which again the bank is not sure how long it might last.
My sincere suggestion to everyone, if required spend your life in a rented house than in a dream house which will never be yours. I am 34 now, and if I continue paying what I am paying now, I will get my house while I am 72 years old, who knows, maybe my daughter who will be 42 by then might visit my grave to give me the good news...
I seriously regret RBI not doing anything to control this kind of robbery in a broad day light.
This is just to warn all those who are planning to take home loan and end up doing same mistake as what I did.
Here is how I got into the trap. I took a home loan from Standard Chartered Bank (SCB) in May 2007 for 46 Lkh at 9% if I am not wrong with 16 years term. In last 50 months, I have paid close to Rs.26Lkh and just recently got to know that the total principal deducted is only Rs.2.5Lkh and rest everything has gone into paying interest due to increase in the interest rate which is now standing at 14%. and a term of 35.4 months still to go. SCB = Suck Customer Blood.
When inquired I got to know that I will be paying same amount for next 48 months and surprisingly the bank will deduct only Rs.25000/- (twenty five thousand approx.) out of Rs.26Lkh I will be paying as EMI unless and until I don't pay them a switch charges of Rs.35000/- to change my interest rate from 14% to 10.9% which again the bank is not sure how long it might last.
My sincere suggestion to everyone, if required spend your life in a rented house than in a dream house which will never be yours. I am 34 now, and if I continue paying what I am paying now, I will get my house while I am 72 years old, who knows, maybe my daughter who will be 42 by then might visit my grave to give me the good news...
I seriously regret RBI not doing anything to control this kind of robbery in a broad day light.
Sir, I entered SBI home loan on 25th June 2006 for Rs.5.1 Lakhs with interest rate of 9.25% floating basis, loan agreement is -1.5% of SBAR (interest will vary minus 1.5% of State bank advanced rate). When i bought the loan SBAR is 11.75%, RBI's CRR is 7.00%, but now my loan interest is 12.25% since SBAR is 14% but RBI's CRR is only 7.25%. is it right sir. my view sbi charging rate of interest is too high.
Hi , I wanted to go for an home loan of 25 Lakhs with my husband . Is it possible for me to get the home loan together with my husband and if so what will be the better term for such home loans. is it ok if I will take for only 10 yrs or more than 10 yrs is better? Also sugegst me which will be the better bank for that. - Pragyan
Dear Sir, i have taken loan from ICICI bank interest rate is 14.5% now i want to switch over to nationalised bank where interest rate is 8% what is the preclosure interest? kindly suggest is it Feasible swich over to nationalised bank thanks
Hello Harsh,I have an existing home loan with ICICI currently @ 11.75% and though I have made a few pre payments my current liability is 12.5 lacs.I have been offered interest rate of @ 9% by a nationalized bank,but ICICI pre closure condition is 2.1%Now will this be charged on the total loan amount or the current liability and that the last 12 installments will also be taken into consideration for the calculation?Please advise? Do you think it will be a good idea to switch over at the earliest?
