House Loan Interest Rate

[Mridul Sethi]

Sir,

 

I had taken houseloan from bank in 2009 @9.25% & as per bank my current interest rate is 13.25%, but at bank's site for new customer interest rate is 11.5% for same amount & tenure. Is it possible?

[MANDAVILLI RAMAKRISHNA]

s. possible. better to check with your bankers, if they cant solve, shift to other bank for lower rate of interest.

[Ashwani Rustagi]

Whenever, interest rate on previous home loan is higher than the interest rate applicable to new customer, normally bankers come out with the scheme wherein they charge some charges on %age basis on outstanding loan amount and bring the interest rate to the current level.

Check-up with your banker immediately. The other option is to switch over the loan to other banker and there is no penalty charges on pre-payment. You can easily get interest rate of 10.50% to 10.75% depending on the loan amount. 

 

AI Summary

Home loan interest rate disparity: borrower can seek conversion with charges or transfer loan without prepayment penalty. The borrower faces a higher contracted home loan interest rate than new-customer rates and may either negotiate with the existing lender for a rate reduction or conversion (often subject to a fee on outstanding principal) or transfer/refinance the loan to another bank; verify contractual prepayment terms and fee disclosures when choosing between conversion and loan portability.