This is to bring to notice the gross injustice and unfair practices followed by HDFC and other private sector banks in respect of existing home loan customers. I submit as under
1. We had availed home loan from HDFC, Andheri East Mumbai branch in September 2008 on FLOATING RATE of interest.
As I learn the Bank (HDFC) has now increased its rate of interest by 0.5 per cent w.e.f. this month, accordingly the rate of interest on my home loan is now a exorbitant 11.00 per cent p.a. which is much above the market rate of interest of 8.50 per cent charged by other banks. This is nothing but a white collar robbery as the ultimate objective of taking a floating rate of interest gets utterly defeated.
2. Upon my last visit at the branch one alternative was suggested by their representative was to pay a conversion fee of 0.75 per cent upfront to lower the rate of interest to 9.5 per cent. Charging this conversion fee is totally unethical and cheating existing customers as the loan taken is on FLOATING RATE of interest. The entire concept of RPLR is unjust and a way to cheat existing home loan customers. How can HDFC charge any such fees to lower my rate of interest when I have opted for Floating rate loan
Flexible rate of interest has to be adjusted to current market rate (whether upward or downward)
3. When the interest rates were going down during past 2 years the same was not adjusted downwards proportionately and promptly as they have shown promptness in adjusting the same upwards now. My home loan interest has always been well above the market rate of interest which is totally unacceptable.
4. Moreover, the bank is charging 2 per cent as prepayment charges which ensures i cannot shift my home loan to other banks offering competitive terms. In this free regime of Economy, how can HDFC stop people to shift to other banks offering better terms and services. The fact of levying prepayment charge itself shows the non competitive terms of your bank and the guilt intention involved.
5. In view of aforesaid facts and circumstances, I request one of the following solutions
• Lower my rate of interest to match the market rate of interest WITHOUT PAYMENT OF CONVERSION CHARGES or
• WAIVE OFF PREPAYMENT CHARGES so that I can transfer my loan immediately to an ethical service provider.
6. I have written several letters and email to HDFC but no one bothers to reply. Upon discussing the same personally with their branch officials they offer absolutely baseless arguments.