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Loan Foreclosure

Discussion in 'Insurance & Loan Reviews' started by bnzjon, Jul 23, 2010.

  1. Bala

    Bala Esperto

    Messages:
    1,070
    Villupuram
    Yes,preclosing Housing loan is a good idea
    Can this also be done??,say,pay 80%of the loan amount,about 3.5 lakh rs now and pay the rest in small EMI s for the same duration???.Iam just dong that,Ive paid 2.5 Lakhs of the 3 Lakhs loan amount and paying the rest in small amounts,just for name sake.But my bank is Central bank and the interest rate was 10% with interest on the diminshing balance
    If one starts thinking about the total interest paid to the bank on the loan amount,one can not sleep!
  2. Oops my bad !.I didn't notice he was talking about home loans..
  3. Cubbie

    Cubbie Superiore

    Messages:
    579
    Bangalore
    I'm trying to close my previous car loan via HDFC and have reapplied a loan fr new GP...the agent is looking to waive 1 or 2 % on the pre closure rates which is around 6% pf the outstanding principle... man these banks fleece..no loyalty bonus at all...
  4. They waive (1 or 2 percent) only if you take a fresh loan on/before the preclosure date :(
  5. redbull

    redbull

    Messages:
    292
    Bangalore
    HDFC has variable preclosing penalty depending how much time has elapsed from start of loan.
    1. No preclosure allowed during 1st 6 months
    2. 6% before 1 year
    3. 5% before 2nd year
    4. 3% after 2nd year

    http://www.hdfcbank.com/personal/loans/ ... r_fees.htm

    I was a victim at 5%. Generally they will have things like "pre approved loans" to entice you, so it is better to go for SBI with some hassle.
  6. after loan is closed

    Just to make sure I am doing things the right way. I foreclosed the loan. Received the set of document ( form 35 and NOC). Now what ?
  7. arey why have we to pay more when we are returning the money to the bank itself??
    this is ridiculous...
    corporation bank does not have this preclosure penalty or such sort..
    South Indian Bank also used to not have but now they started it albeit at a very less rate(2% i guess)
  8. Good Question :), now the bank has to get money for it's maintainance right :p
  9. kedarbendre

    kedarbendre Esperto

    Messages:
    4,215
    MH 12
    I foreclosed my HDFC car loan in last week. I paid 6% on outstanding amount as I foreclosed it within 7 months. :-(
  10. rsinfo

    rsinfo Regolare

    Messages:
    422
    New Delhi
    Why pay foreclosure charges to the bank ?

    If you have extra money, instead of paying the back, invest the money in short term debt funds. These are giving you around 8% p.a. right now. Transfer the money from these funds to your bank account every month before paying your EMI.

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