Non-reduction of Interest rate on home loan
Legal Fighter
(Querist) 28 May 2009
This query is : Resolved
Hi Experts,
I had taken home loan from a private bank on floating rate of interest. The bank increased the rate of interest at very fast speed from 7% to 12.75%. But as the interest rates are going down, the bank has reduced the rate just to 12.25%. For more reduction in interest rate, they are offering some plans by payment of 1% or 2% of outstanding amount and getting the interest rate reduced to 11% or 10%.
Now my question is that is all this ethical and legal on behalf of the bank? What can I do?
Y V Vishweshwar Rao
(Expert) 28 May 2009
Rate of interest -
1-Fixed rate &
2-Floating Rate
As per the Agreemtn terms the Floating rate to be applied to the Laon account
Legal Fighter
(Querist) 28 May 2009
sir, there should be some constraint onto the bank as they have options of reducing the interest rate but they are seeking additional charges for the same. Moreover, for new customers, the bank is offering at 9.25% floating rate of interest.
Even if we have signed the loan agreement w.r.t. bank's terms and conditions, it doesn't mean that bank employs unethical practices. There should be some ways to curb their bad practices.
Legal Fighter
(Querist) 29 May 2009
I do understand that even SC has given liberty to private banks but for reducing interest rate, is it ethical and legal to charge additional fee of 1% or 2%?
Manish Singh
(Expert) 11 June 2009
if you find it unethical, and in my view also it is unethical, please file a complaint to the Banking Ombudsman.
