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Home Loan: You know about these hidden charges, know everything before taking a loan

Customers taking a loan at a fixed interest rate have to pay a prepayment charge. This charge can be some percentage of your outstanding loan.




There are many charges associated with a home loan. Most of the people are aware of the processing fees and legal or technical fees levied before taking a home loan, as their amount is high, but even after getting a home loan, many charges are deducted from your home loan account. These charges are very nominal and various banks, housing finance companies charge them accordingly.

Various charges before taking a home loan

  • Processing Fee
  • Administration Fee
  • GST
  • Technical and Legal Assessment Fee
  • Credit Score Report Charge
  • Incidental Charge

Various charges after getting a home loan

  • stamp duty and registration charges
  • Documentation charge
  • loan conversion
  • charging the extension of the loan or loss
  • EMI Late Pament penalty
  • Pre-Pament charge
  • Loan account statement
  • home loan re-Senkshn
  • Czech bounced penalty

If the documents related to the home loan are lost, then a charge has to be paid for the duplicate copy as well. These charges are deducted from your home loan account like

335-500 is charged for repayment instruction or instrument return.
There is a charge of Rs 50-300 for copy of no-dues certificate or no-objection certificate.
50-300 rupees are charged for copy of interest certificate (provisional or actual).
For photocopy of title document, Rs 500-800 charge has to be paid.

Fee for change in tenure of home loan

Suppose you have taken a home loan for 15 years, but now your income has reduced and paying EMI has become difficult, then you can get this tenure extended. The bank will levy a cost for changing the bank tenure.

Loan conversion fee

If your home loan is running under the old MCLR regime, then you have to pay a fee for loan convergence with the bank to take advantage of RBI’s benchmark rate. If you want to leave the old regime and switch to the new repo-linked regime, then the bank will proceed with the application after charging you the fee.

EMI Late Payment Penalty

The borrower is bound to make the EMI payment on time. Delay in doing so will result in default and you will be liable to pay monetary fine. While some banks charge a fixed amount, other banks charge a fixed percentage on the installment amount as a penalty. If your home loan EMI is late in a private bank, then you have to pay an additional interest of 24% in a year.

Prepayment charge

If you have taken a home loan at floating interest rate and prepayment, then no charge is to be paid, but customers availing a fixed interest rate loan have to pay a prepayment charge. This charge can be some percentage of your outstanding loan.

Account statement charge

After a few years of taking a home loan, if another bank offers you a loan at a lower rate, then you have to get some documents from your current bank to get the loan transferred to that bank. The new bank can accept you only after checking this document. If you do not have any such documentary proof, then you will have to contact the home branch and get a copy of such document, for which a nominal fee has to be paid.

Home Loan Re-Sanction Charges

After the approval of your home loan, if you do not take the disburse amount within three months or the deal is canceled at the last moment from where you are buying the house, then you need a sanction letter again and the bank will charge for the same. .

Parvesh Maurya
Parvesh Maurya
Parvesh Maurya, has 5 years of experience in writing Finance Content, Entertainment news, Cricket and more. He has done BA in English. He loves to Play Sports and read books in free time. In case of any complain or feedback, please contact me @ praveshmaurya24@gmail.com
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