Ambiguity over interest rate outlook forces lenders to introduce three-month reset clauses.
High interest rates and lack of funds has hit non-banking finance companies. Though banks had extended loans to NBFCs at fixed rates, there is a reset clause which is now being exercised. Besides, the increase in interest rates is impacting companies that were borrowing directly from the market. What is also making life tough is the demand for longer-tenure loans by borrowers as they want to keep the equated monthly instalments under control despite a rise in interest rates.
Always be clear about the clauses and conditions laid down by your bank or housing finance company. If at all you skip this task then you may face a major problem during the entire tenure of your loan or may be even beyond that.
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Banks will introduce hybrid home loans with stiff penalty on prepayment and shifting.
In case the repo rate keeps trending downwards, borrowers can expect a downward revision of their MCLR-linked loans.
If you have plans to buy a new home in 2015, there's good news for you
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