While an existing borrower is reeling under the burden of ever increasing EMI, banks have embarked on all out rate war to attract new customers. At first glance, banks appear to be wooing new customers with various concessions to make up for high interest rates and higher property prices. While doing away with processing fees… Continue Reading
The Reserve Bank of India (RBI) raised its repo rate – rate at which it lends to banks – and reverse repo rate – the rate it pays to banks for deposits – by a quarter of a percentage point to 8.25% and 7.25% respectively. With today’s rate hike, RBI has raised interest rates 12 times in… Continue Reading
In a major relief to home buyers, RBI has asked banks not to impose prepayment penalties on floating interest home loans irrespective of the source of funds. RBI has rightly pointed out that floating rate loans pass on the interest rate risk from the banks to borrowers. Thus, banks only substitute interest rate risk with… Continue Reading
As we mentioned elsewhere, “fixed rate” home loans are offered by banks when the interest rates are at peak or near peak and these offers dry up when interest rates come down. India Infoline, ICICI and HDFC banks have now introduced dual rate home loans and more lenders are likely to join the “rat(e) race”… Continue Reading