We are only conducting Seminars to make Professional Traders. The material published on the blog is of general and educational information only and is not suitable for trading purpose. We do not provide Stock Tips. Please do not make any payment on website. All Material is available Free on the site.

Pre Payment Penalties on Home Loan Closure Abolished as Per RBI Directive

Reserve Bank of India has asked banks not to levy any penalty on pre-payment of loans taken on floating rate. This is going to provide a relief to home loan borrowers as banks do not want borrowers to close the home loans which they have taken on the higher rate of interest. The announcement and its implementation forcefully is credit worthy on te part of RBI.

The decision has been taken at RBI credit policy review (annual monetary policy announcement for 2012-13) to bring a uniformity in whole system.

The policy noted that the Damodaran Committee had observed that foreclosure charges levied by banks on prepayment of home loans were resented upon by home loan borrowers across the board as one has to shell out a large amount as a prepayment charges which force the borrowers to keep servicing the higher rate interest loans.

RBI had to step in the whole mechanism as a consensus was reached last year at the Banking Ombudsmen Conference to the effect that banks should not impose pre-payment charges on loans with a floating rate of interest. Moreover the housing finance regulator National Housing Bank (NHB) has directed all housing finance companies to desist from imposing a pre-payment penalty. However still a large number of banks have been observed not passing on the benefits to the old clients.

Most Visited Stocks - Click to Visit Link

We Teach and Train our Readers as we want to make sure that Readers become thorough professionals. We do not provide any stock tips. Please do not make any payments. Your joining or reading content is subject to acceptance of our terms and Disclaimer for which link is given on the site at bottom right hand corner. Wherever the word tip is written; it implies an idea which is of informational value and is not suitable for trading. Trade ideas if any are for educational purpose only. We are conducting Seminars to make Professional Traders. Join Now for Bangalore, Chennai and Hyderabad. Leave query through contact form.
Chart> Nifty A B C D E F G H I J K L M N O P Q R S T U V W X Y Z 0-9