Query about home loan transfer

seetha,

I have discussed this shifting in some thread, and am not able to relocate it.

infact i also thought i would do the same some time back, but when you sit and work it out, it does not make much of a difference. let me try to explain the procedure.

when you go for a shift, it is a new loan with the other bank. that is you are apply for a new loan with lic. hdfc has a clause that states that you have to pay penalty if you are closing the loan using money from another loan/bank. as long as you pay from your personal source it is not penalised. so there you pay around 2%+.

the preclosure charge is inclusive of this or not is something you have to work out.

in the meantime, that is the time between the loan being processed and the document being received by lic, you have to give a security either in the form of deposits or something. (i asked for a switch from one bank to another..) check that out.

and work it out. after paying 3% (almost..) will it work out fine for you.

I think after 3 years it is floating rate. what happens if it goes to the same 11/12% and ofcourse it is a risk that you take.

for the same, i think you can pay a small fee for restructuring your rate of interest plan (I think it is allowed) with hdfc..

look into all the options, compare and take decisions. also, check with other banks too..i think sbi is offering 8% or 8.5%...

all the best. do check it out and also post your decision.

 

You are welcome seetha,

with the rbi crr increase, though the banks are saying there will not be any interest changes, keeping my fingers crossed for all.

 

Seetha

How about paying off couple of lakhs of the loan and getting the rest of the amount refinanced through another bank, that way check if the itnerest rate would go any further down??

Because as I see that there is a slab rate for the amoutn of loan taken i.e >20 laks 8%, >25 laks 9% etc...

first weigh out the options and research whether any bank is ready to do this refinancing and then pay off some loan amount and get the refinancing done . (I do not know about India, but here in US usually this is what is done to get a better rate of interest when the interest rates drop down.)

Shanthi madam correct me If this approach works or not!

 

sv,

whatever shifting is done, it is a new loan as far as the other bank is concerned.

you can re-negotiate your roi with the existing bank,by paying a small fee. that if if you were at 22l and by paying 2.5lacs you enter the <20lacs, and previously your ROI was 9.5 and the rate of interest now for <20lacs is 8.25 then by paying a fees for the roi adjustment, you can shift to the 8.25. this is possible instantaneously if it was floating. if it was fixed, i don't think it is that easy.

that is what i have tried to explain to the op. you are forced give a security for the interim, between the documents transfer.

 

Even for floating rates of interest banks used to circumvent the rules. Whenever the intrerest rates went down, they used to give loans to new customers for lower rates. But for the existing customers they continued charging the high interest rates.

Recently, RBI sent strict instructions (read it as kick on the backside ) to the banks that the benefit of lower rates should be given to existing customers who opted for floating interest rates. Things are better from then.

-Lakshmi

 

Lakshmi,

i do agree with you that rbi's kick did lot of good. but I got the roi renegotiated even before this. guess i was lucky. I feel, when you meet your banker with all the details in hand, you have a better chance at negotiation.

 

Shanthi,

Can ROI negotiation be done with private banks like ICICI and HSBC too?

-Lakshmi

 

lakshmi,

ICICI yes. hsbc no idea. I did with HDFC.

and recently when i was talking to my bank (nationalised) about another loan, he also told me yes.