Don't rush to switch banks for lower home loan rate, advise experts
The last few weeks have seen a flurry of activity in the home loan segment, led by major housing finance lenders
Sep 10, 2014
Source : The Economic Times
Home Loan

 

MUMBAI: Despite some large banks and housing finance companies reducing home loan rates a few days ago, industry-observers and planners are advising borrowers to adopt a wait-and-watch approach instead of hurriedly switching lenders.

The last few weeks have seen a flurry of activity in the home loan segment, led by major housing finance lenders. State Bank of India has slashed its home loan interest rates by 15 basis points for loans of over Rs 75 lakh.

Mortgage lender HDFC has also extended its scheme offering an interest rate of 10.15% for all loan amounts. Punjab National Bank, apart from reducing rates, has also waived off processing fee and documentation charges. ICICI Bank, on the other hand, has launched a fixed rate scheme charging interest of rates 10.25-10.50%, depending on the loan amount, for ten years.

The deluge of offers could tempt many to switch to a lender offering a lower rate to reduce the interest rate burden, given that prepayment penalties on floating rate loans have been abolished. Moreover, many banks, during negotiations, are willing to do away with or reduce processing fees to attract new customers. Yet, you should be cautious while taking a call on transferring your loan to another lender, say planners.

"In the competitive environment that prevails in the housing loan space, it is likely that once a large bank cuts rates, other banks will follow suit sooner than later. By delaying your decision on switching by a few weeks, you will be able to avoid the hassle of completing the charges, cumbersome paperwork and other formalities," says Suresh Sadagopan, founder, Ladder7 Financial Advisories.

You can also explore the option of internal switch -where the lender allows its existing borrowers to move to a lower rate that is offered to new customers after charging a conversion fee.

Latest Realty News

Govt. tampering with land records: Shettar
Sep 10, 2014
Leader of the Opposition in the Legislative Assembly Jagadish Shettar on Tuesday alleged that the State government, which has come under the scanner over the denotification of land meant for Arkavathy Layout, was trying to tamper with the rights of records by divesting ownership from the Bangalore Development Authority
Realty boom breeds settlements, factions
Sep 10, 2014
It is an alarming development according to the industry. The expected capital region in the VGTM (Vijayawada, Guntur, Tenali and Mangalagiri) is in for multiple land registrations, settlements and factions
Tenders to make Hyderabad wi-fi enabled to be floated soon
Sep 10, 2014
Seeking to position Hyderabad as the top destination for IT companies in India, Telangana government today said it plans to call tenders by this month- end for making the capital city wi-fi enabled
Akhilesh Yadav counters PM Narendra Modi's smart cities with digital villages
Sep 10, 2014
The ruling SP may have been routed in the LS polls by the Narendra Modi juggernaut but CM Akhilesh Yadav is gearing up to counter the PM's governance agenda with people-centric initiatives
Realty sector slowdown may hurt stamp duty collections in Punjab
Sep 10, 2014
The Punjab government's ambitious plan to mop up Rs 2,760 crore in the current financial year from stamp duty and registration fee is going to be an uphill task in view of the slowdown in the real estate sector
Maharashtra issues draft rules for formation of housing regulatory authority
Sep 10, 2014
Realty developers in Maharashtra could soon face disqualification and cancellation of registrations of their projects, if a court declared the document (contractual agreement, power of attorney, etc) giving them the right to a land parcel or development rights, invalid
Noida home buyers write to PM Modi to notify eco sensitive zone soon
Sep 09, 2014
Following TOI report that the Centre's draft of the redrawn eco-sensitive zone around the Okhla bird sanctuary doesn't affect any realty project in the area, wave of hope has float among the home buyers and other major beneficiaries.
Most Nagpur buildings sans fire safety measures
Sep 09, 2014
It seems like a disaster is waiting to happen ? nearly 2,358 of the 2,790 buildings in Nagpur have no fire safety clearance
NMC preparing new development plan for Nagpur
Sep 09, 2014
Nagpur Municipal Corporation (NMC) has begun preparing a new development plan (DP) for the city. It will replace the existing DP five years before it is due owing to large scale changes that have taken place
Illegal construction rampant on EWS plots
Sep 09, 2014
There seems to be no place for the poor in the Millennium City, though they have played an important role in its development

Latest Realty News Of State

Realty Talk's