I took a home loan for around Rs 27 lakhs last year at 10.25% from HDFC Ltd.
Now, with the Base rate reduced for most banks, my Interest rate will be changed to 10.05% starting next month. But, I want to change it the lowest interest rate, 9.9%. They have declared that it will be 9.9% for both new and existing customers.

When I checked with HDFC Customer Service, they gave me some technical response about spread being changed which will cost me Rs 7,000.

Can someone help me understand why is this Rs 7,000 charged? Will this be charged the next time as well when interest rates change? Can it be waived off? Should I move to some other bank (I bank with ICICI)?:D

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  • HDFC Home Loan Interest Rate Change

    If you change it by paying RS 7000, and if you calculate the amount gained in a year, it will be almost same what you paid for the change of ROI. Changing a bank is not an option. All the banks change it every year. 0.10% is not a big saving In the short run. It is useful only in the long run. You cannot keep changing your home loan every year. You will also have to pay processing fee for every home loan change and you will end up loosing money. I suggest if you have some savings you can opt for a home saver loan with any of the govt banks offering it.